WCI Steel opposes secured noteholders' objection to exclusivity extensions

By Jeff Pines

Washington, May 3 - WCI Steel, Inc. opposed its secured noteholders' motion to end the company's exclusive periods to file a plan and solicit acceptances.

WCI filed its reorganization plan on April 20.

In a Monday filing with the U.S. Bankruptcy Court for the Northern District of Ohio, Eastern Division, the company said the company needs to promptly resolve the proceedings and that a secured noteholders' plan competing with its own would hurt the company.

On Friday, the United Steelworkers of America filed an objection to the secured noteholders' attempt to end the company's exclusivity periods. Also that day, the official committee of unsecured creditors filed its objection to the noteholders' motion, the company said.

The noteholders, who have prepared a plan, do not have a collective bargaining agreement with the union, WCI noted.

Under the plan, holders of the company's existing $300 million 10% notes will receive $94 million of new secured notes, the principal amount being equal to the secured portion of their claim. For the unsecured portion, they will share in $5 million plus interest that will be paid to class 7 general unsecured claims five years after the effective date of the plan. The new secured notes will pay a coupon of 6.5%, in cash or kind at WCI's option. They mature after 10 years and are callable any time at par.

The secured noteholders in a separate Monday filing with the court contend the company's assets are worth far more than $94 million.

WCI filed for bankruptcy on Sept. 16, 2003. Its Chapter 11 case number is 03-44662.

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