Reuters: Bankruptcy News: UPDATE 1-RG Steel files for Chapter 11 bankruptcy

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UPDATE 1-RG Steel files for Chapter 11 bankruptcy May 31st 2012, 13:34 Thu May 31, 2012 9:34am EDT * Has more than $1 bln in assets, liabilities * Idled three steel plants last week May 31 (Reuters) - RG Steel LLC filed for Chapter 11 bankruptcy protection on Thursday, one week after the company said it was running short of liquidity and set plans to idle three steelmaking plants. Privately held RG Steel said a week ago it was suffering a liquidity crisis, looking for a buyer and would idle all three of its steel mills starting in June. Workers were told in letters the company would stop operations at its Sparrows Point mill outside Baltimore and its plants in Warren, Ohio, and Wheeling, West Virginia. RG spokeswoman Bette Kovach had no immediate comment on the Chapter 11 filing on Thursday. The company and several affiliates filed for protection from creditors in the U.S. bankruptcy court in Wilmington, Delaware. RG Steel said it has more than $1 billion in both assets and liabilities. U.S. steelmakers have struggled with weak demand, rising costs and narrowing margins. Production capacity has yet to fully recover from the most recent recession. RG Steel bought the three plants from Russia's Severstal' OAO in 2011 for about $1.2 billion, becoming the fourth largest U.S. flat-rolled steel producer. Renco Group Inc and Cerberus RG Investor LLC hold ownership stakes in some of the debtors, according to court filings. Link this Share this Digg this Email Reprints

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