Hussey Copper files bankruptcy, secures $84.7 million purchase offer

By Caroline Salls

Pittsburgh, Sept. 27 - Hussey Copper Corp. filed Chapter 11 bankruptcy Tuesday in the U.S. Bankruptcy Court for the District of Delaware.

Chief restructuring officer Dalton T. Edgecomb said in a statement filed with the court that the company defaulted on a credit agreement with PNC Bank after it failed to repay the facility at maturity.

Edgecomb said Hussey was unable to refinance the loan or find replacement financing.

As a result, according to the filing, the company has entered into an $84.7 million stalking horse agreement with KHC Acquisition, LLC in connection with the proposed court-supervised sale of substantially all of its assets.

In connection with the bankruptcy filing, the company has obtained a commitment for $50 million in debtor-in-possession financing to fund its operations during the sale process.

PNC Bank, NA is the DIP loan agent, and PNC, Wells Fargo Capital Finance, LLC and Bank of America, NA are the lenders.

The facility will mature on the earliest of Nov. 28, the effective date of a plan of reorganization, the closing of the sale of substantially all company assets and conversion or dismissal of the bankruptcy case.

Interest will accrue at the alternate base rate plus 500 basis points.

The company is seeking interim access to $35 million of the DIP financing.

According to court documents, Hussey Copper has zero to $50,000 in assets and $50 million to $100 million in debt.

The company's largest unsecured creditors include the following:

• Metal Management Pitt, Inc., of Elizabeth, Pa., with a $9.05 million trade debt claim;

• CMC Recycling of Irving, Texas, with a $2.71 million trade debt claim;

• H K P Metals Inc. of McKeesport, Pa., with a $2.64 million trade debt claim;

• Tri State Metal Co., Inc. of Chicago, with a $1.64 million trade debt claim;

• Wimco Metals Inc. of Pittsburgh, with a $1.49 million trade debt claim;

• United Scrap Metal Inc. of Cicero, Ill., with a $1.35 million trade debt claim; and

• Cronimet Trading Corp. of Rochester, Pa., with a $1.03 million trade debt claim.

The company's common stockholders are class A and class 1 common stockholders are Roy D. Allen and James K. Goldberg.

The company is represented by Saul Ewing LLP.

Hussey is a Leetsdale, Pa.-based copper products manufacturer. Its Chapter 11 case number is 11-13010.

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