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Sale Seen Likely for Canadian Steel Foundry

Jan. 2, 2011
Maritime Steel and Foundries forced into receivership
A Canadian steel foundry, Maritime Steel and Foundries Ltd. in New Glasgow, N.S., has been forced into receivership by its parent company, Cameron Corp. According to local news reports, the 108-year-old operation has had its C$17.8-million loan called by Cameron, which has declined to extend any further support to the foundry. Maritime Steel and Foundries pours high- and low-alloy and manganese steel castings ranging from 5 to 3,500 lb., for customers in the railroad, mining, earth engaging, marine, and general industrial sectors. It boasts ISO 9001:2008 and ISO 14001:2004, as well as AAR M-1003 and ABS certifications. Reports indicate the plant has been idled. Cameron Corp. is a Houston-based manufacturer and supplier of pressure and flow control products for oil and gas exploration and processing. It persuaded a Nova Scotia Supreme Court judge to name a receive for the foundry. The receiver appointed by the court is BDO Canada Ltd., which is understood to be fielding bids for the operation. The sale is made more likely because of the receivership, which is likely to reduce the secured creditors’ opportunities for claims recovery, and to eliminate any chance for unsecured creditors to recoup their loans. "They’re likely to get zero," according to Paul Goodman of BDO Canada, interviewed by The Canadian Press. He told the newspaper it would take C$20 million to pay all the secured creditors, and the sale priced is unlikely to reach that total. Goodman said “three or four potential buyers” have indicated some interest in the Maritime Steel assets.