Historic changes for the steel industry are starting to be realized following a federal bankruptcy court judge approving several sales of steel mills that have been owned for a little more than a year by now bankrupt RG Steel.
RG Steel's bankruptcy has meant the sale of mills in Warren, Steubenville, Mingo Junction, Yorkville, Martins Ferry, Follansbee and Sparrows Point, Md. They were all at one point part of a rare steel industry dynasty: Wheeling-Pittsburgh Steel Corp.
Experts in the steel industry and in several related fields continue to see the unusual "fire sale" pace RG set for selling the assets as having been detrimental rather than positive, in that possible bidders may not even have been aware the process had started much less was coming to a conclusion.
Tribune Chronicle file
A view of the RG Steel mill in Warren, which is being sold as part of a bankruptcy case.
Now that those seals of approval from the court have started to happen, the dominos are beginning to fall, as details small and large surface as direct results of the action and coming changes in ownership, and each has to be reviewed, addressed and gain approval from the court.
Proof of that change will be marked by a unique gathering of union officials in Pittsburgh today.
The meeting: one of last times presidents of the local unions whose members work for RG Steel, and are represented by the United Steelworkers Union, will come together to discuss the facts of day to day life under the ownership of the now bankrupt company owned and controlled by billionaire Ira L. Rennert.
Each of the plants owned by RG will now be heading down an individual path. Some see flickers of hope at the moment when it comes to the possibility of re-establishing some level of production. Others will be left to pick up the pieces.
Monaca, Pa.-based CJ Better Enterprises' cash bid of $16 million was the highest for the Pine Avenue S.E. mill, according to bankruptcy court filings.
Charles J. Betters, founder and owner of the real estate development company, confirmed his company was the "apparent high bidder on the facility." He noted, however, that the transaction has to be reviewed by lawyers handling the company's bankruptcy before it can be finalized. A hearing is set for Wednesday in bankruptcy court in Delaware to consider approval of the sale.
Betters said his team is prepared to complete the purchase agreement as soon as possible and hopes to restart the mill.
"My hope is to restart it," he said. "But there's a lot of work to be done. We don't even know if it's ours yet."
Betters said he preferred not to discuss the matter pending the finalization of the sale, but did say he intends to keep company employees informed.
The Warren mill employed about 1,200 workers.
Charles Bradford, president of Bradford Research Group, which monitors the metals industry, said the Warren plant has the greatest potential for reopening because it makes a high carbon steel that is not made by a lot of its competition.
"That's a big advantage that the other plants did not have," Bradford said. "Of course, the plant also has its disadvantages. It does not have its own raw materials needed for the steel and it likely will need to purchase a new blast furnace as well as other equipment."
Court filings list a back-up bid of $15 million was submitted by Environmental Liability Transfer Inc. and Warren LLC.
Frontier Industrial Corp. submitted a winning bid of $20 million for the Mingo Junction facility. An attorney for Frontier said parts of the Mingo Junction facility will be demolished, but that there is a chance that certain operations at the site could continue.
In a phone interview Friday, Craig Slater confirmed Frontier is considering a number of options for the future of the Mingo Junction mill's various resources, which could include operation of portions of the facility such as the 80-inch mill and the virtually brand new electric arc furnace there.
The Steubenville mill is expected to be scrapped.
It was purchased for $15 million by Wheeling-based scrap entity, Strauss Industries.
The steelworkers of Local 1190 barely saw more than a few month's work during the term of ownership by Russian based steel giant, Severstal and none under RG's ownership.
Unemployment compensation monies, benefits of any kind including insurances for most who worked at the Steubenville mill or the Mingo facility ran out not long after their jobs evaporated several years ago.
The final hearing on the pending sale of the Yorkville mill to Esmark has been continued until Wednesday. At the direction of the federal bankruptcy court judge, discussions were held Thursday concerning initial details of a possible labor contract that will be needed before the judge will sign off on the transaction.
It is known the parties met Thursday.
There has been no public confirmation concerning when those court directed talks will resume.
Should Esmark pull its bid, the approved back-up bidder was Frontier.
Local business leader W. Quay Mull and attorney Jo Gompers were successful in getting their purchase of the Martins Ferry plant approved this past week.
Mull's various businesses located throughout the region include a steel Arrowstrip Steel, which is located just a short distance away from the Martins Ferry mill he has just purchased.
During a recent conversation about the future plans for the galvanizing facility just purchased from RG Steel, he offered that his business goal for the plant is a return to some level of steel operations.
An auction for the Sparrows Point mill on Tuesday ended with a concluding bid of $72 million from Hilco Industrial, a company that specializes in industrial liquidations.