Bayou Steel expects to emerge from Chapter 11 on Wednesday

New York, Feb. 17 - Bayou Steel Corp. said it expects to emerge from Chapter 11 on Feb. 18 or soon after.

The LaPlace, La., minimill operator said that under the plan holders of its $120 million of 9½% first mortgage notes will receive a $30 million secured notes and two million shares of new common stock, according to a 10-Q filing with the Securities and Exchange Commission. The new note will pay interest at 9% and mature in 2011.

Bayou Steel's $45 million debtor-in-possession credit facility will be replaced with a new facility.

Existing stockholders will receive nothing.

The company will liquidate unsecured trade claims at 9% to 10% of their value over the course of a year. The payout could be higher under certain circumstances.

Bayou Steel filed for Chapter 11 on Jan. 22, 2003 in the U.S. Bankruptcy Court for the Northern District of Texas. The case is number 03-30816.

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