Russian Firm Buys Into U.S. Steel Operation

washingtonpost.com ^ | Wednesday, December 29, 2004 | Vicki Smith

[Destro]

Russian Firm Buys Into U.S. Steel Operation

By Vicki Smith
Associated Press
Wednesday, December 29, 2004; Page E02

MORGANTOWN, W.Va., Dec. 28 -- A subsidiary of Russian steel giant OAO Severstal will spend $140 million to rebuild the aging coke ovens at Wheeling-Pittsburgh Steel Corp.'s Follansbee site, then take half ownership and share the coke, the companies announced Tuesday.

Severstal, which has been making acquisitions in recent months, aims to become one of the top five steel producers in the world. Severstal North America Inc. signed a letter of intent for the coke plant deal with Wheeling-Pittsburgh last week and plans to close by March 31.

Severstal plans to commit $140 million for improvements over four years and make an additional $20 million payment to Wheeling-Pittsburgh.

The companies each would get 50 percent of the more than 1 million tons of coke the new plant could produce. Coke is a key fuel in blast furnaces and is in short supply worldwide, though Wheeling-Pittsburgh is able to meet about 95 percent of its own coke needs.

[FormerLib]

A Weirton ping?

[Eric in the Ozarks]

For decades, American steel makers produced a $400 ton of steel and sold it for $300. Now steel is $800/ton and Bethlehem, LTV, etc., are gone.

[Fitzcarraldo]

What's next, China buying into U.S. agricultural operations?

[rightcoast]

Wheeling Pittsburgh Steel Corporation

Severstal North America - Company Profile

[Destro]

It breaks my heart to be honest. Plenty of blame for the fall of American steel to go around for everyone - the Feds for regulating a fixed price - the management for being lazy and not investing in new mills and procedures and the unions which helped reduce any flexibility.

[Eric in the Ozarks]

The Red Chinese own a piece of one of the iron ore mines in northeastern Minnesota. The pellets move via Great Lakes ore carrier to the St. Lawrence Seaway, and then are shipped via ocean-going freighter through the Panama Canal and across the Pacific.

[Eric in the Ozarks]

Bethlehem Steel had one of the most modern steel mills in North America at Burns Harbor. Their poor relations with the employees is what did them in.

[Destro]

I don't buy the all the blame falls on the employees did them in theory.

[Eric in the Ozarks]

Bethlehem, more than any other company I can think of, went out of its way to antagonize and radicalize its employees. When the company needed help, they tried to take it out of the employees' checks and management kept its enormous salaries and perks.

[Destro]

No doubt - what I meant is that there is plenty of blame to go around - management - unions - the feds.

[CDHart]

We live in a rural area -- last evening I went to our local grocery story, where they had various types of frozen fish filets on sale. They included salmon, halibut, flounder and a couple of others. Every one of them was a product of China. No wonder we're now a net importer of food. They're selling that fish far below what an American company would sell it for.

Carolyn

[mountaineer]

I don't know what else W-P can do - it's sink or swim, and swimming requires assistance of whoever has the money, unfortunately.