Super Steel Products Corporation has announced that it is seeking protection from creditors as the company prepares to be sold, perhaps to the company's chairman.
As per report, Super Steel has filed a petition for receivership under Chapter 128 of the Wisconsin statutes. The filing is part of a strategic business effort to reposition the company for new growth and success as the United States emerges from the current economic downturn.
Mr Jim Schmelzer president of Super Steel said that the company has requested that the court appoint Milwaukee lawyer Mr Michael Polsky as receiver.
In a petition with the court seeking an appointment of a receiver, Super Steel listed assets with a book value of slightly more than USD 16 million. The petition also lists liabilities totaling more than USD 44.4 million, including USD 15.6 million owed to M&I Marshall & Ilsley Bank and USD 16.9 million in subordinated secured debt.
Mr Schmelzer said that Super Steel remains in business, that it expects substantially all jobs to remain in place and that the company will continue to accept and fill all customer orders throughout the court proceedings. The company has secured funding to cover its operations during the reorganization effort.
He added that "Today's filing gives Super Steel the time and framework to reposition while we continue to operate our business as usual. We have a going business, a backlog of orders and excellent employees. This step changes none of that."
In conjunction with the filing, Mr Schmelzer said that Super Steel chairman Mr Fred Luber, who currently holds a major stake in the business, intends to submit a bid to purchase the company’s assets. Other interested buyers can file bids as well, with the winning bid to be determined by the court.
Although Super Steel expects its plants to remain open and its workers to retain their jobs, Mr Schmelzer said that a plant closing notice must be provided under the requirements of federal and state law. Any buyer of the business is expected to immediately rehire substantially all Super Steel employees under its new ownership and operation of the business.
Mr Schmelzer said that the decision to reorganize was difficult, but necessary. He added that "It's no secret that times have been tough in the manufacturing industry. We've experienced significant challenges along with our customers, our competitors and everyone else. But we also see good signs that the economy is improving. As that turnaround approaches, we want to ensure Super Steel is effectively positioned to maximize its opportunities."
Super Steel manufactures steel and metal equipment and products for the freight locomotive and passenger rail industries, as well as the industrial, construction and agricultural markets. The company operates two facilities in Milwaukee - its headquarters and factory at 7900 W Tower Ave and its transportation and manufacturing plant at 7100 W Calumet Road.
The company, which employs about 250 people, has roots in Milwaukee dating back to 1923.
