In connection with the potential shutdown, the Company has entered into an agreement with AK Steel Corporation, Magnetation Inc. and the Company's senior secured lenders to cease operations and implement a wind-down process. Absent securing additional financing and/or a third party purchaser of its businesses, the Company will be seeking Bankruptcy Court approval of the agreement on or before September 30, 2016.
"While this was a difficult decision, the Company believes that, in light of current circumstances, preparing for a safe and orderly wind-down while we continue to seek an alternative to a shutdown is the best course of action to support what is in the best interests of our employees, creditors and other critical constituents," said Larry Lehtinen, CEO of Magnetation. "As a result, we are communicating the proper notifications to our employees and the communities. We will be working closely with the appropriate governmental agencies to assist any affected employees who would be laid off if this shutdown is implemented."
Magnetation LLC. is a joint venture between Magnetation, Inc. (50.1% owner) and AK Steel Corporation (49.9% owner). Magnetation LLC recovers high-quality iron ore concentrate from previously abandoned iron ore waste stockpiles and tailings basins. Magnetation LLC owns three iron ore concentrate plants located in Keewatin, MN, Bovey, MN and Grand Rapids, MN, and an iron ore pellet plant in Reynolds, IN. Additional information about the company is available at www.magnetation.com.
This press release contains statements that are forward-looking in nature and relate to our expectations, beliefs and intentions. All statements other than statements of historical fact are statements that could be deemed to be forward-looking, including, but not limited to, statements about the expected impact and timeframe of the shutdown and our ability to continue to fulfill customer needs. These statements are subject to risks, uncertainties and assumptions that could cause outcomes to differ from our expectations, including, but not limited to, continued depression or further decreases to iron ore prices, changes in demand for our products or steel, unforeseen operational difficulties with or costs relating to our plants or third-party suppliers, negotiations with collective bargaining units, and other factors described in the reports and information provided to our investors. We assume no obligation and do not intend to update any such forward-looking statements.
Media Contact: Matt Lehtinen
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SOURCE Magnetation LLC