U.S. Steel is Making Money while Restructuring

by San Antonio Attorney

U.S. Steel is generating revenue while waiting for a bankruptcy judge’s approval to extend its creditor protection.

A report from the court shows that company’s income from Nov. 22 to Jan. 2 had a net positive earnings of $85.4 million.

The cash position of the company now stands at $188 million. U.S. Steel does not expect more improvement until May 15, and for this reason it is asking the bankruptcy court to extend the creditor protection until that day. Because of its income, the company does not have to depend on the $185 million debtor-in-possession loan from U.S. Steel Corp, its American parent.

U.S. Steel filed for bankruptcy last September, stating loses of about $2.4 billion for the past 6 years. The aim of the company goal is to sell its Canadian firm by October2015.

According to USW 1005 President Gerstenberger, the profit is insignificant to steelworkers when you look at the big picture. He said Lake Erie made some profit while Hamilton didn’t, but that Hamilton did perform than it had anticipated.

Steelworkers were unhappy that the bankruptcy judge approved the debtor-in-possession loan, as it made U.S. Steel Corp. the largest creditors. This meant that the corporation would obtain its share out first in case the Canadian unit became insolvent.

Despite considerable work over the past years to make the Canadian unit profitable, the company believes that restructuring is crucial in order to create a more positive long-term business outlook.

Bankruptcy is a viable option for a business that is in financial distress. Chapter 11 is used by big corporations while Chapter 13 is used by small businesses. You can contact a San Antonio Chapter 13 Attorney on small business bankruptcy matters.

Leave a Comment

Previous post:

Next post: