Rolling Mill Owners Object to Sale
HANNIBAL – The owners of the property that once housed the Ormet Rolling Mill are among those objecting to the sale of the closed Primary Aluminum Reduction Plant for $15.25 million, according to documents filed with the U.S. Bankruptcy Court for the District of Delaware.
As officials with the United Steelworkers await word on the potential sale to CCP ORMT Acquisition, Ohio Rep. Jack Cera, D-Bellaire, believes the relatively low price is not a good sign.
“It seems like the same thing that happened with the (Wheeling-Pittsburgh Steel) properties when they were sold out of bankruptcy,” Cera said. “It should have never come to this.”
In 2004, the Mingo Junction steel mill, then operated by Wheeling-Pitt., received a new $115 million electric arc furnace. However, once the plant ended up in bankruptcy under the ownership of RG Steel in 2012, another company was able to buy the entire Mingo facility, including the furnace, for just $20 million.
“My understanding is there might be someone interested in operating, but then you still have the power issue,” Cera said.
Cera spoke of Ormet’s dispute with American Electric Power last year that saw the aluminum company ask the Public Utilities Commission of Ohio to lower its rates. The PUCO did offer to reduce the rates, but not to a degree that Ormet officials believed was manageable for their business.
USW spokesman Tony Montana said while the organization is aware of CCP’s “stalking horse status,” he could offer no comment until the process is complete.
Court documents filed Wednesday include an objection to the sale filed by Hannibal Real Estate and Artco. Hannibal Real Estate purchased the former rolling mill property from Ormet in 2007, while Artco operates a heavy plate steel service center and a steel fabrication center on the 122-acre site.
The real estate firm opposes the sale because of an ownership dispute over six mooring cells located in the Ohio River immediately offshore from its property, as well as two river water intakes.
According to the U.S. Army Corps of Engineers, mooring cells are circular steel sheet structures filled with either stone or concrete and capped with concrete. The cells help prevent barges from inadvertently damaging a dam structure.
In February, Ormet officials announced intentions to sell the reduction plant that sits between the Ohio River and Ohio 7 in Monroe County. This was roughly one year after the company filed for bankruptcy protection amid a business environment that included falling aluminum prices and escalating AEP bills.
In the meantime, roughly 900 former Ormet workers either maintain hope of returning to work, or have moved on in search of new careers. Cera said this is the most difficult aspect of the matter.
“These bankruptcy issues are tough because it seems like the assets are sold off for virtually nothing, and the workers are the ones left with nothing,” he said.