History is hampering efforts by Hamilton's hedge fund owner to sell

Nov 17, 2006 | 04:30 PM | Sam Kusic

In steel, there has to be some give and take to seal a deal or it might just snap back in your face.

In the case of Hamilton Specialty Bar Corp., that give will now have to come from the United Steelworkers union, according to Delaware Street Capital LLC (DSC), the hedge fund that owns—and is trying to sell—the mill.

While Hamilton is piquing interest, takers are unlikely unless the USW agrees to a change in the way retiree benefits are paid, DSC claimed last week.

Legacy costs are dampening interest in the Hamilton, Ontario,-based special-bar quality maker, said Gary Katz, DSC's director. And unless the union, which has declared its intent to find a buyer on its own (AMM, Nov. 16), agrees to a move that would push those costs off the balance sheet, it isn't going to succeed, he said. "I am highly skeptical about whether the union will find a buyer that will do this in an on-balance sheet manner."....