Two investment firms have begun looking into ways to restructure Wheeling-Pittsburgh Steel Corp.'s $500-million debt to seven major banks and lending institutions, a United Steelworkers official says.
Paul Rusen, director of the union's Wheeling, W.Va.-based District 23, said the New York firms Lazard Freres & Co. and Salomon Bros. Inc. began discussing the debt with the banks Wednesday night.
The union and Wheeling-Pittsburgh officials agreed to hire the firms Wednesday after resuming talks in Pittsburgh on the steelmaker's sagging finances. Another round of discussions is scheduled this morning.
Lazard Freres will report to the union while Salomon Bros. will present its findings to the company, Rusen said.
The talks between the union and company broke off Feb. 13 in a dispute over the investment firms.
At that time, the union said it would not meet with Salomon Bros., which had been hired to replace Lazard Freres. Lazard Freres, hired jointly by the company and union, quit after reportedly accusing Wheeling-Pittsburgh Chairman Dennis Carney of setting a time limit for reorganizing the company's debt.
Rusen said Wednesday, however, that time is still a critical factor because the company's financial condition is "dangerous."
"There isn't a lot of time left. We should be in a posture by March 15 to have some findings," the USW leader said.
Wheeling-Pittsburgh lost $54 million in 1983 and $9.9 million through the third quarter of 1984. Rusen has said repeatedly that the company is on the verge of bankruptcy and must reorganize its debt.
Rusen said Wednesday that he expects the discussions to produce calls for further union wage and benefit concessions as well as offerings of preferred stock to employees.
But he added that the union will not grant the concessions without contributions from the other parties involved.