LB STEEL, LLC

Case Highlights

• A judgment order was entered against the company for over $19 million
• Steel prices were falling, negatively impacting sales, margins and collateral value
• Secured lender called a default
• DSI appointed as CRO to oversee a sale process in a bankruptcy proceeding
• The sale proceeds paid the secured lender in full and provided for the continuation of the business

Case Narrative

LB Steel was a steel distributor and fabricator located in Harvey, IL; Topeka, KS and Warren, OH. LB Steel was involved in litigation for many years over a product quality dispute. In 2015, a judgment order was entered against LB Steel in the net amount of $19.2 million.

Also during 2015, there was a precipitous decline in steel prices that negatively impacted the company’s sales and gross margins as well as decreased the value of the inventory collateral securing its bank loan. The bank called a default and froze the company’s bank accounts.

DSI was appointed as Chief Restructuring Officer (CRO) to coordinate a Chapter 11 filing and oversee the sale of the business. The business was sold in 2016 at a value that paid the secured lender in full and provided for the ongoing operation of the business.