Japanese Firm May Pour Cash Into LTV Corp.

A Japanese steel manufacturer is interested in investing $200 million in LTV Corp., a move that would shore up its joint ventures with the American steelmaker and give it firmer footing in the U.S. steel market, LTV said Monday.

However, the investment by Sumitomo Metal Industries Ltd. depends on LTV reaching an agreement with creditors on a plan to emerge from bankruptcy protection. It filed for Chapter 11 protection five years ago.

It also depends on LTV resolving a multibillion-dollar pension liability and on reaching a new contract with steelworkers.

Meeting those conditions could prove tricky because LTV’s creditors have become increasingly impatient. LTV filed a preliminary reorganization plan in May that was staunchly rejected by most of its creditor groups.

Christopher Plummer, a steel consultant with WEFA Group of Bala-Cynwyd, Pa., said he expects LTV and its creditors to agree on a plan to pave the way for the Sumitomo investment.

The Sumitomo offer, while not substantial in terms of the steel industry, “may give creditors, stockholders and other investors more confidence in LTV’s future,” he said. “There could be more to come in the future if things work out.”