As many as 200 steelworkers in Hamilton are facing an uncertain future.
Their employer, Hamilton Speciality Bar (HSB) on Sherman Avenue, has gone into receivership and is looking for a buyer.
Hamilton Specialty Bar produces carbon and alloy steels for the automotive, heavy truck, mining and service centre sectors.
McMaster business professor Marvin Ryder said he’s not surprised by the receivership. He said the company has had cash flow problems since it emerged from its last bankruptcy protection in 2007 and had difficulty paying its creditors.
“Sometimes they’d make the payments, sometimes they wouldn’t make the payments, sometimes they’d have to restructure the loan,” Ryder said.
LISTEN: Marvin Ryder joins The Bill Kelly Show 0n 900 CHML
He said on Jan. 8, the creditors announced they had lost faith in the the company’s ability to pay its loans and asked the court to appoint a receiver.
Court documents show HSB owes Wells Fargo Capital Finance Corporation Canada more than $27.5 million.
The receiver, Ernst & Young, will be in a Toronto court Thursday to ask for permission to officially start the sale process.
Ryder said they’re “going hopefully find a buyer with a deeper set of pockets and a more stable approach who can take this over.”
The United Steel Workers Union said Hamilton Speciality Bar has about 170 unionized employees, 45 non-union staff and approximately 400 retirees.