A bankruptcy judge has overturned a $20.9 million bid from Leggett & Platt Inc. to purchase Georgetown Steel Co. and instead declared International Steel Group the high bidder.
Judge John Waites based his ruling in part on the added value to the creditors and community of putting the plant back into operation.
ISG will begin hiring in few days to clean up the plant and get the equipment back in working order, said Gordon Spelich, vice president of the company, based in Richfield, Ohio.
When it first announced its intention to buy the bankrupt mill, ISG said it planned for production to be under way in the fall.
Leggett & Platt, however, would not discuss its plans for the mill. That led to charges from the steelworkers union and creditors that the company wanted to break up the mill and sell its parts.
The hearing, June 17th, was on Georgetown Steel Co.'s request to sell the mill to Leggett & Platt for $20.9 million.
ISG, which started the bidding at $16 million, ended at $20.4 million in an auction held in private earlier in the week.
But the union and creditors' committee argued that ISG was the winner if the union's waiver of $7 million in possible claims had been considered.
The creditors and union showed "credible and convincing evidence" that ISG's offer should have been valued higher but also that having an operating mill provides more value to the creditors, Waites said.
"It is a value that should be considered by this court," Waites said. "There is a benefit to the community."
Leggett & Platt's attorney quickly offered $1 million more, but Waites refused to consider it or allow the auction to be reopened. Associated Press