June 7, 2013

Update:  As previously reported, Ormet Corporation (“Ormet”), an aluminum producer and manufacturer of custom and standard primary aluminum, foil, sheet, billet and other aluminum products, filed for Chapter 11 bankruptcy status on February 25, 2013.  This week, the bankruptcy court approved the sale of Ormet to a private-equity firm, Smelter Acquisition LLC, which is owned by Wayzata Investment Partners LLC of Minnesota, where Wayzata has provided $30 million for the restructuring that will be used along with a $60 million credit facility from Wells Fargo.

Ormet’s bankruptcy filing and court approval are no surprise to the OMAEG.  Recall that the OMAEG was the only party in October 2012 to publicly oppose Ormet’s request for a modification to Ormet’s unique arrangement.  It is unclear at this time what the impact of Ormet’s bankruptcy will be on other ratepayers in AEP-Ohio’s territory with respect to Ormet’s existing reasonable arrangement.  Counsel is monitoring the PUCO docket and will provide updates accordingly.