W&K Steel files for bankruptcy

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W&K Steel files for bankruptcy

Post  HopefulInPh on Sun May 29, 2011 1:33 pm

W&K Steel files for bankruptcySaturday, May 28, 2011 9:50 AM

May 28--Under threat of foreclosure, controversial steel fabricator W&K Steel LLC filed for bankruptcy in federal court in Pittsburgh on Friday.

The company listed debts of between $1 million and $10 million, but assets of less than $1 million, according to court documents. The company, based in Rankin, has between 50 and 100 creditors.

At least 16 area construction projects -- including work at Penn Hills High School and the Jefferson Regional Medical Center -- could be delayed because W&K is a subcontractor supplying structural steel needed on the jobs, according to court documents.

The company shut down earlier this week, but some of its 35 employees returned to work yesterday, W&K President Edward Wilhelm said yesterday before the bankruptcy filing was available. He could not be reached afterward.

Earlier this week, a Common Pleas Court judge placed W&K in receivership after Huntington National Bank filed a $2.5 million judgment against it in Allegheny County Court for defaulting on loans. The bank sought to foreclose on the company and have it sold.

Huntington declined to discuss the matter, said spokesman William Eiler.

W&K, which fabricates steel, aluminum and bronze products, has been cited several times by the Occupational Safety and Health Administration. In February, the Allegheny County Council passed a bill dubbing the company a "sweat shop" that paid foreign workers less than other workers. County Executive Dan Onorato did not sign the bill, and Wilhelm dismissed the allegations as opposition to his operating a non-union shop.

The company and affiliate W&K Erection LLC are operating under receivership directed by The Meridian Group, a Downtown management consulting and turnaround firm. Officials there could not be reached.

"I hate to see any company go bankrupt. It's a shame because Ed has a long history in the building industry," said Denny Riley, credit manager for Metals USA Inc., Ambridge, which supplies steel beams to W&K.

Metals USA is W&K's biggest unsecured local creditor, owed $118,526, court papers show. How much it collects "will all have to get decided by the court," Riley said.

W&K's largest unsecured creditor is Contractors Steel Co., Livonia, Mich. It supplies structural steel to the company and is owed $250,754. Credit Manager Garry Herrold said his company would have to "chalk it up as a cost of doing business."

Massaro Corp., O'Hara, said in documents filed in Allegheny County Court that several projects in which W&K is involved are on a "critical path" and the work must be performed immediately. It asked the court to intervene in Huntington's legal proceedings.

In its filing, Massaro said W&K's fabricated structural steel is needed "immediately" on the following projects: The Neighborhood Academy in Garfield, Penn Hills High School, St. Elizabeth Ann Seton Parish in Carnegie, Jefferson Regional Medical Center and the United Cebral Palsy Center in Oakland.

The Neighborhood Academy project needs a metals package from W&K to meet a scheduled July 31 completion date, Massaro said.

"We're building a new school and we're planning on starting the new school year there," said Jodie Moore, president of The Neighborhood Academy, a private school that serves college-bound, low-income students in grades 8 to 12. The school, which will consist of two buildings, is on the border of Stanton Heights and Garfield.

Spokesmen at other projects could not be reached. Jefferson Regional hospital spokeswoman Candy Williams said she was not certain which construction project at the hospital involved W&K Steel.

Another construction company, Rycon Construction Inc. in the Strip District, told the court W&K is needed to complete structural steel work for a building project at the West Virginia Army National Guard's Camp Dawson in Kingwood, W.Va.

Joseph Massaro III and Todd Dominick at Rycon could not be reached for comment.

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To see more of The Pittsburgh Tribune-Review or to subscribe to the newspaper, go to http://www.pittsburghlive.com/x/pittsburghtrib/.

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