GRAND RAPIDS, Minn., Dec. 7, 2016 /PRNewswire/ -- Magnetation LLC ("Magnetation") announced today that it has filed a motion with the U.S. Bankruptcy Court seeking authority to enter into an asset purchase agreement ("APA") that provides for the sale and transfer of substantially all of its remaining assets and certain liabilities along with the assumption and assignment of certain executory contracts and leases in connection with a sale to ERP Iron Ore, LLC through a credit bid by the Company's post-petition lenders. This motion to sell its remaining assets follows Magnetation's entry into a Global Settlement Agreement on August 26, 2016, which was approved by the Court on October 6, 2016 and provided for the wind down of operations, the sale of inventory and accounts receivables, the termination of the pellet purchase agreement and the sale of the remaining assets of the Company.
"After nineteen months under bankruptcy protection, we are pleased to have reached this important milestone supported by a wide coalition of the stakeholders in this case. This outcome provides the potential for a restart at some point in the future of the state of the art Magnetation assets as a going concern, which has been our goal and would provide the best possible value to the estate and its stakeholders," said Larry Lehtinen, CEO of Magnetation. "We are especially pleased to be acquired by ERP Iron Ore, LLC, an affiliate of ERP Compliant Fuels, LLC, an innovative company founded and led by Tom Clarke with whom we share a vision for advancing our unique and environmentally responsible technology, that turns abandoned iron resources into valuable, high quality iron ore pellets to serve steel-makers on a global scale."
ERP Iron Ore, LLC:
ERP Iron Ore, LLC ("ERPIO"), a subsidiary of ERP Compliant Fuels, LLC, through the acquired Magnetation assets, plans to recover high-quality iron ore concentrate from previously abandoned iron ore waste stockpiles and tailings basins in Itasca County of Minnesota. Upon closing of the APA, ERPIO will own three iron ore concentrate plants located in Keewatin, MN, Bovey, MN and Grand Rapids, MN, a railroad loading facility in Grand Rapids, MN and a 3.0 million tons per annum iron ore pellet plant in Reynolds, IN.
This press release contains statements which 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 APA and our ability 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 variability in 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