Crucible Industries Bankruptcy: CPM Steel Business Sold to Erasteel for $11–12M

Crucible Industries, LLC sold its Crucible Particle Metallurgy steel business and intellectual property to Erasteel and its Geddes, New York real estate to Lauter Metal Technologies through a two-lot section 363 sale, then converted to chapter 7 on May 30, 2025 after the sales closed and its workforce was laid off. The specialty steel manufacturer filed chapter 11 on December 12, 2024 in the U.S. Bankruptcy Court for the Northern District of New York (Case No. 24-31059, Hon. Wendy A. Kinsella) after a pre-filing marketing process produced interested buyers but none willing to commit outside a court-supervised sale.

KeyBank held a first-position lien on substantially all assets and provided the debtor-in-possession financing, and sale proceeds flowed first to its claims. The debtor split its assets so the CPM platform and trademarks could be marketed apart from the legacy plant and real estate. Steel grades including MagnaCut, S30V, and S35VN depend on the CPM trademarks, which transferred to the Lot 1 buyer. The unsecured creditors' committee and the U.S. Trustee contested whether the structure preserved enough value for non-KeyBank stakeholders, and the case moved to chapter 7 rather than a confirmed plan.

Debtor(s)	Crucible Industries, LLC
Court	U.S. Bankruptcy Court, Northern District of New York
Case Number	24-31059
Judge	Hon. Wendy A. Kinsella
Petition Date	December 12, 2024
Conversion Date	May 30, 2025
Employees	About 170 full-time and 8 part-time; WARN notice for 158
Facility	575 State Fair Blvd., Geddes/Solvay, NY (65+ acres)
DIP Facility	Revolving DIP up to lesser of borrowing base or $13.0 million (KeyBank); interim roll-up; March 7, 2025 maturity
Secured Debt	KeyBank ~$10.28 million; ESD ~$5.486 million; CX Industries $3.0 million
Lot 1 Buyer	Erasteel Inc. (CPM business and IP)
Lot 2 Buyer	Lauter Metal Technologies (real estate and residual assets)
Sale Orders	Lot 1: March 6, 2025; Lot 2: March 12, 2025
Claims Agent	Stretto, Inc.

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CPM Steel Platform and Knife-Market Stakes

Crucible has manufactured specialty steel in the Syracuse area since 1876, and the First Day Declaration describes the debtor as a producer of Crucible Particle Metallurgy powdered-metal, stainless, alloy, automotive valve, and tool steels, with manufacturing operations at its Solvay/Geddes plant. Its current corporate form, Crucible Industries, LLC, dates to 2009, when the prior Crucible Materials Corporation entity went through its own chapter 11 and the business was acquired by JP Industries for about $8 million. The debtor reported more than 1,000 patents tied to its production processes.

Crucible's CPM platform is a powder-metallurgy process that produces the branded knife and tool steels the company is best known for, including S30V and MagnaCut. The First Day Declaration lists both the CPM intellectual property and the physical production line — a 40-ton electric arc furnace, a 3-ton induction furnace, and press and rolling mills at the 65-acre Solvay site — as core assets serving automotive, power generation, aerospace, and industrial machining markets. Knife Steel Nerds reported that Crucible owned the trademarks for "CPM" and "MagnaCut" and that control of those marks determines whether any mill or distributor can sell steel under those grade names. Control of those marks made the CPM business separable from the legacy plant, and the debtor structured the sale in two lots to market it independently.

Workforce, WARN Notice, and Pre-Filing Marketing

The debtor employed about 170 full-time and 8 part-time workers at filing, with most hourly employees represented by United Steelworkers locals. On December 5, 2024 the company issued a WARN notice identifying 158 affected employees and a potential shutdown window of March 5 to March 19, 2025, which the New York Department of Labor posted on December 9, 2024.

The company began a formal marketing process in April 2024 through Calibre Group LLC, but the First Day Declaration states that potential buyers would not commit without a bankruptcy sale process. The Sale Motion attributes the distress to softening global steel demand and price competition from larger, better-resourced competitors, which left the debtor without enough liquidity to operate outside chapter 11. Local reporting described roughly $21.5 million in claimed assets against tens of millions in loans and unpaid bills, with county tax records showing roughly $700,000 in overdue property taxes, and noting that four companies had expressed acquisition interest but would not proceed without a court-supervised sale. Spectrum News reported that a potential buyer had committed to paying more than $11 million while the company maintained it still needed a bankruptcy process to close.

KeyBank's First-Lien Control and DIP Financing

The prepetition capital structure was anchored by a KeyBank revolving credit facility holding a first-position lien on substantially all assets. The DIP and Cash Collateral Motion breaks the KeyBank exposure out at not less than $10,279,063.41 — $8,626,491.41 of outstanding principal on revolving loans plus $1,652,572.00 in letters of credit, before accrued interest and fees — backstopped in part by a limited guarantee from Jack Jankovic, James E. Phillips, and Ara Hacet. Below KeyBank sat two junior secured obligations described in the First Day Declaration: approximately $5,486,252.49 owed to Empire State Development under a loan the intercreditor agreement subordinated to KeyBank, and roughly $3,000,000 under a secured demand note (the CX Note) held by sole member CX Industries LLC. The debtor's own lien review indicated both junior creditors had failed to properly perfect their security interests, and trade payables added approximately $11,000,000 of unsecured debt.

The committee sought to preserve estate claims tied to these potential perfection and subordination gaps, and the debtor cited evaluation of lien challenges against KeyBank, ESD, and CX as a rationale for converting to chapter 7.

DIP financing and the March 2025 liquidity bridge. To fund operations through the sale, the debtor sought authority to use cash collateral and obtain postpetition financing under the DIP and Cash Collateral Motion. The Interim DIP Order authorized a revolving DIP facility capped at the lesser of the borrowing base or $13.0 million from KeyBank, priced at the Derived SOFR rate with a 3% default premium and a March 7, 2025 maturity, subject to earlier termination on an event of default, a sale, or plan effectiveness. The facility included an interim roll-up applying cash collateral collected during the interim period to prepetition obligations at the lender's discretion, plus an adequate-protection package of replacement liens, a superpriority claim, default-rate interest, and a carve-out for U.S. Trustee fees, limited trustee expenses, and capped professional fees. The court entered a Second Interim DIP Order on December 20, 2024 and the Final DIP Order on January 22, 2025.

After the Lot 1 sale order, the debtor returned on March 10, 2025 for supplemental bridge financing, explaining that the original DIP had matured on March 7, 2025, the borrowing base was depleted, and it needed immediate liquidity to cover roughly $140,000 of payroll-related obligations pending the Erasteel closing. The emergency request sought up to $500,000 of revolving loans plus up to $200,000 of additional advances at KeyBank's discretion, secured in part by machinery-and-equipment proceeds and limited by an approved budget. Local coverage quoted chief restructuring officer David Van Rossum describing the company's need for immediate DIP liquidity to maintain operations, sustain vendor and customer relationships, and make payroll.

Two-Lot Section 363 Sale to Erasteel and Lauter

Sale structure. The Sale Motion proposed selling substantially all assets in one or more lots, with Erasteel Inc. as stalking horse for Lot 1. Lot 1 comprised the CPM line of business, intellectual property, accounts receivable, and inventory; Lot 2 consisted of residual assets excluded from the stalking-horse agreement — cash, corporate records, insurance claims, benefit plans, tax assets, the real estate, and most machinery not used in CPM production. The split let the debtor market the CPM business and its trademarks separately from the legacy plant.

Bidding procedures and the revised timeline. The court entered a Bidding Procedures Order on December 20, 2024 that originally set a January 30, 2025 bid deadline, a February 4, 2025 auction, and a February 6, 2025 sale hearing, with stalking-horse protections requiring competing bids to clear the purchase price plus a break-up expense fee of $520,460 and a $100,000 minimum increment. That schedule then moved: sale-objection filings state the bid deadline was reset to February 13, 2025, the auction to February 21, 2025, and the sale hearing to February 25, 2025. Syracuse.com reported that Erasteel faced competing bids ahead of the auction. On February 24, 2025 the debtor filed a notice of successful bidders naming Erasteel the winning bidder for Lot 1, Lauter Metal Technologies LLC the winning bidder for Lot 2, and Myron Bowling Auctioneers/Cincinnati Industrial Auctioneers as the Lot 2 back-up bidder.

Lot 1 to Erasteel. Knife Steel Nerds reported an initial Erasteel bid of about $17.3 million, and the Sale Motion described an itemized consideration framework of $2.0 million for intellectual property, $1.0 million for equipment, and $14,348,654.25 for threshold accounts receivable and inventory, subject to adjustments and assumed liabilities. The Lot 1 Sale Order entered March 6, 2025 approved the transfer free and clear of liens with interests attaching to net proceeds, and directed that proceeds flow first to KeyBank's DIP obligations and then to its prepetition obligations. Local coverage later reported the finalized transaction value, after adjustments, was expected to be $11 to $12 million.

Erasteel profile and IP control. Erasteel is a French specialty-steel producer owned by Brussels-based Syntagma Capital. Blade Magazine reported that Erasteel acquired equipment, working capital, and the trademark rights to the CPM steel names, preserving the ability to sell those grades under their established brands. Because Crucible owned the CPM and MagnaCut trademarks, the Lot 1 sale transferred control of the grade names along with the production line.

Lot 2 to Lauter. The Lot 2 Sale Order entered March 12, 2025 approved a transaction with Lauter Metal Technologies covering the Solvay real estate and residual assets, with related transition-services and real-estate agreements and a back-up bidder mechanism. CNY Central reported that Lauter, a Penn Yan-based steel manufacturer, was recruiting workers for the Geddes site, pointing to a potential industrial reuse of the footprint even as Crucible's own operations ceased.

Sale Objections and the Committee's Standing Fight

The U.S. Trustee appointed an official committee of unsecured creditors on January 3, 2025, which introduced a formal challenge path on the financing, the proposed key employee incentive plan, and the sale. A January 9 stipulation among the debtor, the committee, and KeyBank extended the committee's deadline to object to final DIP relief, the KEIP motion, and the break-up expense fee to January 14, 2025.

The sale drew objections from multiple constituencies. The committee argued that sale proceeds should remain available to investigate and pursue estate claims for unsecured creditors; the U.S. Trustee objected that the sale primarily benefited secured creditors and lacked an adequate carve-out for administrative and unsecured constituencies; the United Steelworkers asserted a collective-bargaining successorship issue; North River raised workers' compensation and setoff concerns; FRC sought protection for stored property; and the New York Department of Environmental Conservation pressed to preserve environmental enforcement rights. The committee's position was framed in its amended sale objection.

In its omnibus reply, the debtor responded that the committee's proceeds position collided with the final DIP order, that the existing carve-out already protected administrative expenses, that the union's successorship theory did not apply to the asset sale as structured, that North River's rights could be addressed with clarifying sale-order language, that FRC's stored property was not part of the sale, and that the sale would not impair the DEC's regulatory authority. The court approved both sales over these objections.

Conversion to Chapter 7 and the Trustee Wind-Down

With the sales closed and employees laid off, the debtor filed a motion to convert the case to chapter 7, stating that a trustee could administer remaining estate tasks and evaluate potential lien challenges involving KeyBank, Empire State Development, and CX Industries. The Conversion Order entered May 30, 2025 directed the U.S. Trustee to appoint a chapter 7 trustee, required turnover of books and records, dissolved the unsecured creditors' committee, set a June 19, 2025 final fee-application deadline, and required a final report within 30 days. The debtor's final report noted the May 30, 2025 conversion and stated that materials were delivered to the chapter 7 trustee on June 13, 2025.

On the professionals side, the court approved Bond, Schoeneck & King, PLLC as debtor's counsel, Calibre Group LLC as asset-sale advisor, David Van Rossum as chief restructuring officer, and Stretto as notice and claims agent. Bond's first-and-final fee application sought $711,606.50 in fees and $1,271.24 in expenses for the December 12, 2024 through May 30, 2025 period, and Bernstein-Burkley, as committee counsel, filed a final fee application that was later granted.

The case remained active in chapter 7 well after the Erasteel sale. On March 4, 2026 the court entered an order approving a further trustee sale of equipment and a settlement of a potential adversary proceeding. The lien and claims questions flagged at conversion remained under administration into 2026.

Key Timeline

The milestones below track Crucible's path from its December 2024 filing through the two-lot 363 sale and workforce layoffs to the chapter 7 trustee wind-down and the March 2026 equipment sale and settlement.

Date	Event
1876	Crucible operations established in Syracuse, New York
2009	Prior chapter 11; business acquired by JP Industries
April 2024	Marketing process begins through Calibre Group LLC
December 5, 2024	WARN notice filed for 158 employees
December 12, 2024	Chapter 11 petition filed; first-day declaration, DIP/cash-collateral motion, and sale motion
December 20, 2024	Second interim DIP order and bidding procedures order entered
January 3, 2025	Official unsecured creditors' committee appointed
January 22, 2025	Final DIP order entered
February 13–25, 2025	Revised bid deadline, auction, and sale hearing
February 24, 2025	Notice of successful bidders (Erasteel for Lot 1, Lauter for Lot 2)
March 6, 2025	Lot 1 sale order entered (Erasteel)
March 10, 2025	Emergency supplemental DIP financing sought
March 12, 2025	Lot 2 sale order entered (Lauter)
May 30, 2025	Case converts to chapter 7
March 4, 2026	Chapter 7 trustee equipment sale and settlement approved

Frequently Asked Questions

Why did Crucible Industries file for chapter 11?

The First Day Declaration describes a liquidity crisis: the company could not obtain enough unsecured credit to operate and needed cash collateral and DIP financing to preserve operations. The Sale Motion attributes the underlying distress to softening global steel demand and price competition, and the company marketed itself in 2024 but found no buyer willing to close outside a bankruptcy sale process.

How did the two-lot sale work?

The debtor split its assets into two lots. Lot 1 was the CPM business, intellectual property, accounts receivable, and inventory, sold to Erasteel under a March 6, 2025 order. Lot 2 was the Solvay real estate and residual assets, sold to Lauter Metal Technologies under a March 12, 2025 order.

What was the DIP facility and who provided it?

KeyBank National Association provided a revolving DIP facility capped at the lesser of the borrowing base or $13.0 million, priced at the Derived SOFR rate with a 3% default premium and a March 7, 2025 maturity. After the original DIP matured, the debtor obtained up to $700,000 of supplemental bridge financing to cover payroll pending the Erasteel closing.

Who objected to the sale?

The unsecured creditors' committee, the U.S. Trustee, the United Steelworkers, North River, FRC, and the New York Department of Environmental Conservation all raised objections, largely over whether the structure preserved value and process protections for non-KeyBank stakeholders. The court approved both sales over those objections, and the debtor's omnibus reply addressed each.

Will CPM steels still be available under the same names?

Erasteel acquired the trademark rights to the CPM grade names and entered an exclusive distribution agreement with Niagara Specialty Metals. Most grades retained their original names, while a small number were rebranded — CPM CruWear became "NSMwear" and CPM S90V became "NSM 90PM."

What is the status of the case today?

The chapter 11 case converted to chapter 7 on May 30, 2025, and a chapter 7 trustee took over the wind-down. The estate remained active into 2026, with a further equipment sale and settlement of a potential adversary proceeding approved on March 4, 2026.

Who is the claims agent for Crucible Industries, LLC?

Stretto, Inc. serves as the claims and noticing agent. The court approved Stretto's appointment in January 2025, and the firm handled creditor noticing across the sale process and the conversion to chapter 7.

For related ElevenFlo coverage of industrial and metals restructurings, see Hardinge's machine-tool 363 sale, SWC Industries' $35 million sale, and Aleon Metals' 52-day 363 sale.