With General Motors Corps's (GM) Chapter 11 bankruptcy filing this week, several US steel companies are at risk of losing large sums of money.
US Steel is owed nearly $9.6 million by the automaker, ranking it No. 31 of GM's 50 largest unsecured creditors, while ArcelorMittal USA comes in at No. 32 with $9.5 billion. Another US steelmaker, AK Steel, of Westchester, Ohio, is owed $9.1 million, Severstal NA is another major GM creditor, owed close to $7 million.
To obtain their money, these companies will have to get in line behind creditors whose debt is secured by collateral, such as GM's plants and other assets.Still, at this point, steelmakers seem to have good faith that their loans will be repaid. AK Steel spokesman Alan McCoy said, "We expect to be paid what GM owes through the normal course of business."
Mr. McCoy added, "We will continue to ship products to GM...based on the contracts we have and the business conditions. Our business relationship continues."