By Allison Barker
The Associated Press

CHARLESTON, W.Va. - A group of bondholders seeking to recover losses from Weirton Steel Corp. has filed a motion to delay the sale of the bankrupt steelmaker to Cleveland-based International Steel Group Inc.

The Informal Committee of Secured Noteholders, collectively owed $118 million, objected to the $255 million deal with ISG, arguing a shortened timeline makes it difficult for other potential buyers to submit a bid.

Federal bankruptcy Judge L. Edward Friend II has set a Tuesday deadline to receive competing bids, with a hearing in Wheeling on April 14 to finalize the sale. The bondholders' group has said ISG's bid, which includes cash and the assumption of various liabilities, undervalues the West Virginia mill.

The group filed a motion late Friday seeking to delay the deadline for up to three weeks to allow the committee more time to submit a counteroffer, according to documents filed in U.S. Bankruptcy Court. The group also hopes to complete a separate reorganization plan that "provides significantly higher recoveries to the holders of the obligations and unsecured creditors."

"This valuation level is so low that it constitutes a fire sale," the court papers say.

Company spokesman Gregg Warren told the Weirton Daily Times that the delay request was expected.

The 3,000-member Independent Steelworkers Union released a statement Sunday objecting to any delay.

"Not only have the Noteholders failed to advance a bid to purchase the assets of Weirton Steel, but they have also failed to adequately address the union's concerns," union attorney Rob D'Anniballe said in a release.

Union leadership has said there could be a conflict between what the union and the bondholders hope to achieve from a sale. While the union's interest is protecting jobs, "we have been told by the Noteholders that their interest in the future of Weirton Steel will remain only as long as their financial returns are good," D'Anniballe said.

Weirton, the nation's No. 2 producer of tin-plated steel, sought Chapter 11 protection in May 2003, and had struggled to emerge. ISG would become the nation's largest integrated steelmaker if the Weirton deal goes through.

The union already has signed a five-year deal with ISG that is modeled after contracts the Ohio steelmaker has with the United Steelworkers of America at other mills.

The contract would save about 2,000 jobs in Weirton and is packed with incentives, including bonuses and quarterly profit-sharing.

The union's current contract with Weirton Steel, which expires June 3, cut pay by 5 percent and froze accrued pension benefits.

ISU president Mark Glyptis said Sunday the union has notified Weirton Steel it plans to let that contract expire even if a sale is not finalized by then.

"If the sale of the company is completed earlier under the provisions of the bankruptcy court, we will start working immediately under the terms of the new contract with ISG," Glyptis said.

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On the Net

•  ISG: http://www.intlsteel.com

• Weirton Steel: http://www.weirton.com