Hussey seeks bankruptcy protection
By Kim Leonard
Published: Wednesday, September 28, 2011
Hussey Copper Ltd., which traces its history in Western Pennsylvania to 1848, is pursuing a sale of its assets while seeking bankruptcy protection from creditors.
The Leetsdale-based copper products maker and several related businesses filed for Chapter 11 bankruptcy on Tuesday in U.S. Bankruptcy Court in Delaware, listing debts of more than $100 million. The recession hurt the company, which lost $3 million last year, Hussey said in a court document.
The company said it entered into an asset purchase agreement with KHC Acquisition LLC of Red Bank, N.J., which, with court approval, would become the stalking horse bidder in a competitive bidding process.
Hussey said it fell behind on payments on a revolving loan with a group of lenders including PNC Bank, and couldn't refinance the debt. Nearly $38.2 million is outstanding, a court document said, and the credit line is secured by liens on "substantially all of Hussey's assets."
Hussey said it plans to continue running its business, which includes plants in Leetsdale and Eminence, Ky., during the bankruptcy.
CEO Roy D. Allen couldn't be reached for comment. But John Cunnard, president of United Steelworkers Local 1211 at the company, said he wasn't surprised by the bankruptcy filing.
Hussey officials met with the union officials a few weeks ago to discuss the Leetsdale plant's future, said Cunnard, whose union local represents about 200 employees.
He declined to say what Hussey told the union. But he said the plant continues to operate and make money, and the union expects Hussey to keep it open until it is sold.
There are potential buyers, Cunnard said, and the union favors one of them -- a company involved in the copper and brass industry, which declined to identify.
Hussey said it has 536 full-time employees at the Leetsdale plant and two Kentucky plants. The price of copper has fluctuated since the recession began in 2008, and Hussey's revenue sank from $453.6 million in 2008 to $308 million the next year, before rebounding to $381.9 million last year.
Profit fell from $3.1 million in 2008 to last year's $3 million loss.
The company was founded in downtown Pittsburgh by Dr. Curtis Hussey, a physician. Initially, Hussey made roofing copper, the company's website says, but it moved into making electrical equipment. The company is the world's leading producer of copper busbar, the strips that conduct electricity inside a switchboard or other electrical apparatus.
Hussey moved to the Leetsdale plant in 1963 and opened the Kentucky plant to produce copper busbar in 1966.
Allen and outside investors bought the Hussey Metal Division in 1984, the website says, but the company later repurchased the outside investors' interests.
Hussey makes a variety of products including copper sheet used in construction, copper-nickel alloy sheet and plate and copper tape.
The bankruptcy filing lists several companies among the company's 20 largest unsecured creditors. The largest amount, more than $9 million, is owed to Metal Management Pitt Inc. of Elizabeth. The company owes $2.6 million to HKP Metals Inc. of McKeesport.
Staff writer Joe Napsha contributed to this report.
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