Dayton to Essar: Pay vendors or pay back state loan

Gov. Mark Dayton said Monday unless Essar Steel starts paying its bills, he will press the company to immediately repay a $66 million state loan.

Dayton is giving Essar Steel until the end of the day Wednesday to pay in full all of its Minnesota contractors and other vendors.

He first issued the ultimatum during a phone conversation with Madhu Vuppuluri, President and CEO of Essar Steel Minnesota, last week.

If Essar doesn’t meet the deadline, Dayton said he would call the state’s loan and demand immediate repayment. The same threat applies if the company fails to stay current on vendor payments in the future.

Essar is building a $1.9 billion taconite production facility in Nashwauk. The state loan paid for infrastructure improvements around the site.

Dayton’s office said company officials failed to fulfill assurances made in mid-October that they would pay vendors by October 31.

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