Optima Specialty Steel filed for chapter 11 bankruptcy protection yesterday, as nearly $172 million in senior secured note debt came due, the Wall Street Journal reported today. The bankruptcy filing is designed to keep the specialty steelmaking operations in business, while Optima works out a reorganization plan that gets its debt in line with revenue, according to papers filed in the U.S. Bankruptcy Court in Wilmington, Del. In the past decade, the Miami company collected U.S. steelmaking operations, some of them with decades of history, in leveraged buyouts. Optima has been grappling with low prices and weak demand from the energy, agriculture and mining sectors, according to Moody’s Investors Service, which downgraded the notes in October 2015. In addition to the Dec. 15 maturity on senior secured notes, Optima also faced a Dec. 30 deadline on $87.5 million of senior unsecured note debt. Optima also estimates it owes more than $37 million in other unsecured debt, such as trade bills.
