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Thu Oct 3, 2019, 03:42 AM

Bayou Steel closure, bankruptcy seem designed to duck pledges to workers, parish president, union

Bayou Steel closure, bankruptcy seem designed to duck pledges to workers, parish president, union say


The surprise closure of Bayou Steel Group in LaPlace this week seemed designed to duck the company's obligations to its workers, St. John the Baptist Parish President Natalie Robottom said Wednesday, as she and other officials began dealing with the fallout from the steel mill's sudden shuttering.

During a press conference in the St. John Parish Council chambers, Robottom and union representatives said they felt they had been misled by Bayou Steel's owners about its financial health and prospects, as well as about its pledges to the nearly 400 workers at the 40-year-old steel mill.

"We're disappointed for a company that has been in our parish this long, and there are employees, some of whom have worked there in excess of 30 years, who were caught off guard," said Robottom.

On Tuesday, the parent company of Bayou Steel Group filed for bankruptcy protection. In the filing signed by President and Chief Operating Officer Alton Davis, the company, which is controlled by a Connecticut private equity firm, said it had as much as $100 million in outstanding debts and less than $50,000 in assets.

Read more: https://www.nola.com/news/business/article_a06d9fce-e530-11e9-9c3c-4f5e0c4473f3.html

How can they only have $50,000 in assets? The buildings and equpment should have more value than that.

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Reply Bayou Steel closure, bankruptcy seem designed to duck pledges to workers, parish president, union (Original post)
TexasTowelie Oct 3 OP
TreasonousBastard Oct 3 #1

Response to TexasTowelie (Original post)

Thu Oct 3, 2019, 05:17 AM

1. I'm no expert, but these guys look like they have a junk portfolio-- making whatever...

bucks they can from losing companies.

This would mean that they know how to shift assets in a bankruptcy (see what happened to Sears-- the profitable parts got sold off, leaving the junk and debt to go bankrupt) The fact that they managed to buy the plant at all means they loaded it up with debt just to buy it.

Just a guess-- they grabbed any decent assets and moved other debt into this plant.

Bankruptcy law is complex-- I once had a customer call me to apologize that our invoice was caught in his bankruptcy, which was to get out from under a phony lawsuit. We worked out a deal (legal, I hoped).

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