U. S. Steel's Day in Court Coming on USSC Debt Claims
01/07/2016 - Attorneys for United States Steel Corporation are due in a Canadian court next week, where they will argue that $2.2 billion in debt claims on the company’s Canadian operation are valid – over the objections of a labor union, active and retired salaried employees, and local and provincial governments, according The Hamilton (Ontario) Spectator newspaper.
The six-day trial that’s been scheduled to resolve the matter is an important facet of U.S. Steel Canada's (USSC) ongoing creditor protection case, The Spectator reported, because if U. S. Steel prevails, it will have a big say in USSC’s restructuring plans.
USSC has been operating under creditor protection since September 2014.
U.S. Steel has claims amounting to $2.2 billion against the company. USSC, meanwhile, owes nearly $79 million to contractors and suppliers, more than $1.6 billion in pension obligations and retiree health benefits and more than $150 million in pension aid given to the company by the Ontario government, The Spectator reported.
The United Steelworkers union, the government and others worry that if U. S. Steel is able to move its claims to the front of the line, there will be little to no cash left from a sale to put into underfunded pension plans.
They argue that U. S. Steel is trying to recover its cost of acquiring the former Stelco by classifying what actually is an equity investment as debt, according to the newspaper.
But U. S. Steel attorneys have argued that a failure to approve its claims could result in a liquidation of USSC.
USSC has been operating under creditor protection since September 2014.
U.S. Steel has claims amounting to $2.2 billion against the company. USSC, meanwhile, owes nearly $79 million to contractors and suppliers, more than $1.6 billion in pension obligations and retiree health benefits and more than $150 million in pension aid given to the company by the Ontario government, The Spectator reported.
The United Steelworkers union, the government and others worry that if U. S. Steel is able to move its claims to the front of the line, there will be little to no cash left from a sale to put into underfunded pension plans.
They argue that U. S. Steel is trying to recover its cost of acquiring the former Stelco by classifying what actually is an equity investment as debt, according to the newspaper.
But U. S. Steel attorneys have argued that a failure to approve its claims could result in a liquidation of USSC.
