According to an announcement from AK Steel, its bid for National was just over $1 billion, with $200 million consisting of the assumption of certain liabilities and the remaining $825 million payable to National in cash.
AK Steel said it will seek in a hearing on January 30, to have the bankruptcy court declare it the lead bidder in the competitive bidding process for National’s assets. National has been in bankruptcy since early last year.
AK Steel said its offer is contingent on negotiation of a new contract with the United Steelworkers of America, which represents most of National’s hourly employees.
Also in the competition for National Steel is US Steel, which has a pending $750-million bid. The US Steel bid has drawn intense opposition from the union as well as Rep. John Conyers Jr., (D- Michigan) over US Steel’s refusal to include National’s pension in the deal. (See Steel Unions Battling Potentially Lower Pensions ).
The problem: 10,000 National Steel retirees and another thousand close to retirement age could end up with lower pensions paid by the federal Pension Benefit Guaranty Corp., if a successful bidder for National’s assets can’t be persuaded to take the pension plan as well.