Kentucky Electric Steel has announced its permanent closure after 50 years in operation, laying off 113 workers in Kentucky. The shutdown is expected in March. Kentucky Electric Steel manufactures special bar quality steel bar flats for the cold-drawn bar converter and truck-trailer support beam markets. It makes more than 2,600 different bar flat items.
The company has reportedly changed ownership several times over the past few years. Boyd and Carter counties put about $1 million each into a community development block grant approximately 25 years ago to help keep the plant open when executives last considered shutting it down. The funds from the grant were paid back to the counties over time. Various economic and community development agencies are exploring options to provide support to keep entity open or reopen shortly thereafter. The announcement comes two years after the idling of an AK Steel plant in the region.
The plant’s parent company, Optima Specialty Steel, filed for Chapter 11 bankruptcy in December 2016 in a bid to restructure its finances while continuing to operate. At the time, the company listed close to $172 million in debts coming due and another $87.5 million about to come due. The company completed its restructuring and emerged from bankruptcy in October 2017, according to news reports.