The $185 million loan arrangement, called Debtor-in-Possession, or DIP, would mean the American parent company is first in line to get repaid.
Superior Court Justice Herman Wilton-Siegel approved the loan deal Wednesday afternoon.as part of his approval of the overall bankruptcy protection plan pitched by the company.
There had been intense negotiations over recent days between U.S. Steel and stakeholders critical of the plan, including multiple steelworkers’ unions, the province of Ontario and the City of Hamilton. It appears despite those negotiations, U.S. Steel gave up little from its initial plan. The approval means pensions of former workers are safe for the duration of the bankruptcy proceedings.
Presenting the deal to the court, a lawyer for U.S. Steel said the DIP proposal was “not just fair and reasonable, they’re manifestly in the best interest of all before you."
The lawyer for Steelworkers Local 1005, which represents workers in Hamilton, says her union has "little confidence" in U.S. Steel Corp. as the DIP lender, but will not oppose it.
Lawyers for the city of Hamilton also advised they did not oppose the DIP, since the issue of municipal taxes had been resolved in the discussions over the DIP repayment order.
More to come