RG Steel Wins Approval of Asset Auction, Bankruptcy Loan
RG Steel LLC, the fourth-biggest U.S. maker of flat-rolled steel, won court approval to hold an auction to sell virtually all its assets, Bloomberg News reported yesterday. Bankruptcy Judge Kevin Carey approved guidelines that will govern the asset sale and gave RG Steel permission to borrow $50 million to help fund operations while it pursues a sale. RG Steel resolved objections from the official unsecured creditors’ committee, which claimed in court papers that the financing and sale procedures would lead to a “fire sale.” The company and committee negotiated extensions to deadlines required by the bankruptcy loan, allowing more time for RG Steel to seek buyers for the assets and for creditors to investigate lenders’ claims. The financing, which was to have terminated on July 27, will end on Aug. 10. The lead case is In re WP Steel Venture LLC, 12-11661, U.S. Bankruptcy Court, District of Delaware (Wilmington).