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Mesabi Metallics ready to emerge from bankruptcy

Mining News - Published on Thu, 28 Dec 2017

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Duluth news tribune reported that Attorneys with Chippewa Capital Partners are expected to file documents in federal bankruptcy court within days that will bring the idled Mesabi Metallics project out of the ashes of the Essar Steel Minnesota bankruptcy for good. The documents, which could be filed as early as today in Delaware, will inform federal Bankruptcy Judge Brendan Shannon that all requirements of the bankruptcy plan, approved last summer, are in place so-called bankruptcy emergence.

Mr Tom Clarke, the Roanoke, Va said that "We're ready to exit bankruptcy. Nothing in the case is contested anymore," billionaire who has dived into the Minnesota iron ore industry over the past year.

A major sticking point, with secured junior debtors, was hammered out in arbitration in New York City in recent weeks. Those debtors, mostly banks in India, were owed a combined USD 1 billion by India based Essar. Now they are in line to get USD 300 million from Clarke if the project succeeds, a sort of second mortgage on Mesabi Metallics.

The Itasca County Board held an emergency meeting to make last-minute changes in its contracts with Chippewa, unanimously agreeing to extend a key date until June 30, as the company appeared to be tying up the last remaining loose ends.

Mr Leo Turnt commissioner said of Mesabi Metallics that "I think it's going to be a good project, a successful project."

Mr Clarke told the News Tribune that any other disagreements are set for arbitration or discussions that can occur as the new company moves forward.

Company officials have been working to overcome lingering issues in advance of a Dec. 31 deadline by the state of Minnesota for Chippewa to emerge from bankruptcy or potentially lose state mineral rights at the Nashwauk site.

Clarke is the Roanoke health care industry billionaire who began buying and reviving defunct coal mines in recent years. He formed ERP Iron Ore to buy the bankrupt Magnetation operations last year and has formed Chippewa Capital Partners to bring Essar out of bankruptcy as Mesabi Metallics, forging agreements with global banks and securing both domestic and Chinese customers for his iron products.

Company officials say bankruptcy emergence is necessary before work can start in earnest in Nashwauk. They said construction financing will be secured in coming weeks and will have hundreds of construction workers on the Nashwauk project by April.

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Posted By : Rabi Wangkhem on Thu, 28 Dec 2017
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