WHEELING - Amid reports of a possible sale of its long-shuttered facilities that historically operated under the Wheeling-Pittsburgh Steel badge, officials with RG Steel said they are considering the option.
"I think it's safe to say everything is on the table. That may mean some of the facilities, six months from now, are not part of RG Steel," said Chief Commercial Officer Jerry Nelson, adding "people have expressed interest" in acquiring some of the company's plants.
According to the online publication "Steel Business Briefing," Nelson made his comments Thursday in Baltimore. RG spokeswoman Bette Kovach confirmed the report, noting she attended the meeting at which Nelson spoke.
Photo by Casey Junkins
RG Steel officials said this week the company may look to sell some of its operations within the next six months.
Nelson said RG's Sparrows Point, Md., facility has changed ownership a handful of times already in the past 10 years. Chief Operating Officer Mark Whalen said RG's executives "certainly look at our assets" on a regular basis and acknowledged the company has "some decisions to make in the next few weeks about what we are and how we want to run."
Christ Vergitz, an official with the United Steelworkers Local 1190 in Steubenville, said recently the situation with the plants in the city and in Mingo Junction does not seem to be getting better. The plants, which operated for many years under the Wheeling-Pitt banner, have been idle since spring 2009. Vergitz said union workers believed the Steubenville plant was up for sale.
Upon observing the Steubenville plant while driving on Ohio 7, it appears the outer wall of one of the mill's smaller buildings has been stripped, leaving only the skeleton of steel beams standing. Other portions of the mill are rusting and deteriorating.
Those laid off from the shuttered Steubenville and Mingo Junction facilities also recently lost their health care benefits.
RG Steel can negotiate a sale, but the USW has the authority to turn down any deals it does not like. The steelworkers did this when supporting OAO Severstal's bid to acquire the plants from Esmark in 2008, after Esmark initially tried to sell the facilities to India's Essar Steel.
In addition to the shuttered Steubenville and Mingo Junction facilities, RG Steel also owns the former Wheeling-Pitt plants at Martins Ferry and Yorkville, both of which have at least limited operations ongoing. It owns the Wheeling Corrugating Co. at Beech Bottom, as well. The company is also half owner of Mountain State Carbon's Follansbee coke plant and the Ohio Coatings plant at Yorkville.
According to the RG website, the Pittsburgh Steel Co. was established in 1901, while the Wheeling Steel Co. was formed in 1920. Wheeling and Pittsburgh merged in 1968, based largely on their proximity to each other along the Ohio River.
RG officials earlier this month announced they would "accelerate" a cost reduction program aimed at curbing "operating expenses and costs of goods sold."
John Goodwin, RG president and chief executive officer, said this month, "While there have been occasional signs of industry conditions improving, the fact is the economy and the steel industry have been unable to sustain a meaningful recovery."
"These cost reduction efforts, while difficult, are needed to ensure that our cost structure is appropriate for today's business conditions, and that our operations are competitive," he added.