WARREN Business plan in store for CSC

The union leader said a restart of the idled mill will likely cost a new owner as much as $5 million.
WARREN -- Could CSC Ltd. employees still have an ownership share in the steel mill if a coalition of Pittsburgh-area management buyout and consulting firms arranges a sale?
John Kubilis, a CSC union leader who spent the last seven months searching for an investor partner for an employee buyout of the troubled company, says he still believes it's a possibility.
"They haven't said yes, but they're not saying no, either," he said.
Kubilis, president of United Steelworkers of America Local 2243, said union members are encouraged by the involvement of Renaissance Partners Inc., a management buyout firm with a track record of rescuing troubled manufacturing companies.
Coalition: The firm announced Wednesday it has formed a coalition of legal and buyout experts to put together a business plan for CSC, which filed for Chapter 11 bankruptcy in January.
If the plan can show the steelmaker could become profitable again, Renaissance spokesmen say, the firm has interested, qualified buyers standing by.
Kubilis said he and other Local 2243 leaders have met several times with Renaissance principals, and the union has made it clear that it is willing to cooperate with any plan to restart the mill, whether or not it involves an ESOP.
"Am I happy? I won't be happy until that facility starts up again," Kubilis said. "But this is a big step. We're the only ones that never gave up. Now, in my opinion, we're probably about half way there, "
Expenses: Kubilis said a new CSC owner will likely spend as much as $5 million to restart the idled mill. Start-up expenses would include the cost of relining the ladles and furnaces, foundation work around machinery and bringing back leased equipment that was moved out when the mill shut down in April.
Don Caiazza, a former CSC president and one of four senior managers still working at the shuttered plant, is putting together the business plan for Renaissance Partners, working toward an Aug. 15 deadline.
Kubilis said the plan will have to include a strategy for generating cash flow as quickly as possible. That would probably mean starting up the plant one section at a time, he said, and calling back the laid-off workers as the departments resume operations.
Call backs: Call backs would likely be determined by department first, and then by seniority.
CSC employed 1,375 before the closing, 1,120 of them USW members, and Kubilis said all the union members have recall rights.
Many will have a difficult choice to make if the mill reopens, he said, estimating that 600 to 700 members of Local 2243 have found new employment or are training for new careers.
"Some of them are very happy. They like working Monday through Friday, no weekends, no turns. It's a tough life to be a steel worker. Some may not want to come back," he said.
Contract: Kubilis said Local 2243 would likely favor modifying its contract rather than starting all over with a new one, a process which he said would take many months.
"I don't see a long, drawn-out process of negotiations" to modify the contract, he said, "maybe a week."
The union president said he still believes there's another serious buyer, in addition to those Renaissance Partners is working with, who will make an offer for CSC.
Kubilis said he thinks the Renaissance Partner plan would be the best answer for CSC, however, because the coalition already has enlisted the cooperation of the USW and CSC management. "But don't get me wrong. We're not closing the door on anybody," he added.

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