CHICAGO Bankrupt large-diameter spiral-weld pipe maker PSL North America LLC has been sold to Indias Jindal SAW Ltd. for $100 million.
The $100-million offer by Jindal SAW subsidiary and stalking horse bidder Jindal Tubular USA LLC remained the "highest and best" after an auction held Aug. 15, according to a sales order filed in U.S. Bankruptcy Court in Delaware and signed by bankruptcy court judge Peter J. Walsh.
The sale comes with one multi-million-dollar caveat: AM/NS Calvert LLC has been granted a $5.4-million claim against Bay St. Louis, Miss.-based PSL North America. The claim includes an immediate cash payment of $327,600 as well as the immediate return of all pipe made from coil supplied by the Calvert., Ala., flat-rolled steel mill as well as the return of any coils manufactured by Calvert and not yet converted into pipe, court documents indicate.
PSL USA Inc.s largest creditor was AM/NS Calvert, a joint venture between Luxembourg-based ArcelorMittal SA and Japans Nippon Steel & Sumitomo Metal Corp. AM/NS Calvert was owed $5.32 million in trade debt (amm.com, June 19).
PSL-North America and PSL USA earlier this year filed for Chapter 11 bankruptcy protection, with PSL-North Americas assets expected to be sold at auction. While PSL-North America was struggling financially, parent PSL USA was not able to help the subsidiary due to its own insolvency proceedings in India, according to court documents.
PSL USA owns a majority stake in PSL-North America. Both are subsidiaries of Mumbai, India-based PSL Ltd.
PSL-North America spent about $103 million to build a pipe mill that had an annual capacity of 300,000 tons and was aimed primarily at serving the oil and gas transportation market (amm.com, Nov. 9, 2007).