In the wake of layoffs, Minnesota mining company files for bankruptcy

Author:
Updated:
Original:

A major player on the Iron Range is filing for bankruptcy, a move that may signal a dire situation in Minnesota's mining industry.

According to a Tuesday news release from Grand Rapids-based Magnetation LLC, the company and its subsidiaries have petitioned for Chapter 11 bankruptcy protection, under which they plan to restructure the business.

The iron ore concentrate and pellet producer says it's reached an agreement with creditors that will allow it to continue long-term operations. The release also indicates the company will keep paying employee wages and benefits, such as health care, "without interruption."

“The significant decrease in global iron ore prices along with our existing capital structure has created a challenging business environment in the short term," CEO Larry Lehtinen said, adding that "the reorganization process will create a more competitive and successful company."

This comes just a few months after the company indefinitely idled its iron ore plant in Keewatin, Minn., and laid off 49 workers.

Magnetation also has operations in Bovey and Coleraine, as well as in Indiana, the Star Tribune reports.

It's a situation that seems to be causing jitters at the State Capitol.

"Every legislator dreads hearing an announcement that a large employer in their region is in trouble," said DFL Senate Majority Leader Tom Bakk, according to MPR News. "The reality is our iron ore industry is no longer competitive in a global market."

Magnetation isn't the only mining company impacted by the sagging global market – industry giant U.S. Steel has idled two Minnesota plants over the past couple of months, putting 1,100 people out of work.

Cliffs Natural Resources is also laying off about 100 salaried positions at three of its Iron Range facilities, according to steelworkers union leaders. The company has not commented.

Next Up

Screen Shot 2020-11-25 at 7.34.43 AM

Watch: Drunk squirrel in Minnesota captures the world's attention

The squirrel was immediately cut off after nearly tipping over.

Screen Shot 2020-11-25 at 7.15.09 PM

Small town gym refusing to close facing lawsuit from attorney general

The gym is facing a lawsuit and a temporary restraining order to halt their operations.

credit card, payment

Money Gal Coaching: Bouncing back after living your best life

Kelly Blodgett started Money Gal Coaching after paying down nearly $50K in debt in 18 months.

flickr-mall-of-america-mitchell-hirsch-march-2019

When do stores open on Black Friday this year?

Many major retailers will be open Black Friday, some for extended hours.

police tape, crime scene

Man found dead outside home near Cass Lake

The man was reportedly shot outside the property.

Minnesota_Welcome_Sign_-_Minnesota_Welcomes_You_-_Taylors_Falls_(28269804891)

Gov. Walz announces $1M in grants to boost Minnesota tourism

The money will be used for marketing efforts to attract people to Minnesota's hard-hit tourist spots.

coronavirus, ICU

Nov. 25 COVID-19 update: 72 deaths ties Minnesota's single-day high

A COVID-19 update will not be provided on Thanksgiving Day.

Texa-Tonka

Revival to open its fourth Twin Cities location

The fried chicken and smoked meat maestros are moving to St. Louis Park.

Duluth and Case Recreation Center

St. Paul to open two extra temporary shelters for homeless people

Mayor Melvin Carter announced the new shelters will be opened in the event of excess demand.

vote, election

Minnesota once again had the highest election turnout in the country

Amid the COVID-19 pandemic, a record percentage of voters also sent in absentee ballots.

Related