Ivaco files for bankruptcy protection in Canada and U.S.

By Carlise Newman

Chicago, Sept. 16 - Ivaco Inc. said it has filed for protection under the Companies' Creditors Arrangement Act, the Canadian form of Chapter 11 bankruptcy protection. Ivaco also announced that it has obtained up to $50 million of debtor-in-possession financing from GE Canada Finance Inc.

The Ivaco entities that received CCAA protection have also applied to the court in the Eastern District of Michigan for similar protection of their U.S. assets. The company's U.S. manufacturing operations are being discontinued.

Ernst & Young has been appointed by the Ontario Court as monitor in the CCAA proceedings. The company has retained UBS Securities LLC as its financial advisor in connection with the restructuring.

The restructuring plan consists of the consolidation of the Canadian operations in order to create a more efficient corporate structure; continuing the program for the sale of non-core assets; the renegotiation of various operating and labor agreements; the settlement of debts, including trade liabilities and legal obligations; continuing sales and distribution operations in the United States; and the discontinuance and sale or liquidation of all of the Company's United States manufacturing operations.

The Canadian steel company also announced the appointment of Gordon Silverman as its chief restructuring officer.

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