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Hilco Trading buys steelmaking assets at former RG mill in Warren



Published: Tue, June 4, 2013 @ 12:05 a.m.

warren

By Ed Runyan

runyan@vindy.com

WARREN

Hilco Trading of Northbrook Ill. has purchased the steel-making assets at the former RG Steel mill and says it will “do everything possible to find a purchaser for the facility that can operate the hot-mill facility as a going concern.”

Gary Epstein, chief marketing officer for Hilco, said in a news release that the company will “run a sale process that will include continuing to market the steel- making complex, vetting and evaluating all offers.”

Hilco, which also bought the RG Steel Sparrow’s Point mill out of bankruptcy, may carry out some demolition work at the cold-mill part of the 1,200-acre facility, Epstein said.

BDM Warren Steel Holdings bought the Warren mill out of bankruptcy in September 2012 after the mill had shut down in May 2012. The closing put about 1,000 steelworkers out of work.

BDM consists of C.J. Betters Enterprises of Monaca, Pa., and two business partners who agreed to keep the hot mill intact for nine months after purchasing it. That nine-month period ended in late May, around the time the Hilco sale took place.

BDM carried out an auction that sold off many of the mill’s assets not related to the steelmaking process.

Darryl Parker, president of United Steelworkers Local 1375, which represents about 1,000 former RG Steel workers, said Monday the sale to Hilco means there is “still a light,” though possibly a dim one, that an operator for the mill can be found and the mill will produce steel again one day.

It’s possible the sale took place when it did so Betters and his partners could pay for the winterization work that was done at the mill last fall to ensure that its essential elements did not become inoperable.

The cost of the winterization was reported to be about $1 million.

Hilco was the winning bidder for the former RG Sparrow’s Point mill and second-highest bidder for the Warren mill.

Last December, Hilco announced it would raze the Sparrow’s Point mill, according to the Associated Press.

The sale price of the Warren mill was not disclosed by Hilco, and Parker said he doesn’t know the figure either.

Parker said he met with a Mahoning Valley group in January that was interested in buying the Warren mill, but he hasn’t heard from the group in a couple months. If the group fails to find a way to purchase and reopen the mill, it won’t be because the union stood in the way, Parker said.

“We can offer a competitive wage and benefits package,” Parker said of the union. “We are not the issue.”

Parker said many of his 1,000 members have “moved on” with their lives since the plant’s closing, either getting government-supported retraining, taking retirement or obtaining employment at companies in places such as Lorain, Massillon and Sharon, Pa.

The Warren mill began in 1902 as Republic Steel Corp. The company was then purchased by Jones & Laughlin Steel Corp., which subsequently became LTV Steel.

After LTV declared bankruptcy during the late 1980s, the company was reorganized as WCI Steel and purchased by the Renco Group. However, WCI filed for bankruptcy in 2002, and the mill was sold in 2008 to Severstal SA, one of the largest steel and mining companies in Russia.

In 2010, Severstal sold the mill to RG Steel. RG Steel filed for Bankruptcy in May 2012, and BDM purchased the facility in August of that same year.


Comments

1glbtactivist(235 comments)posted 10 months, 2 weeks ago

Bad news for the area. This firm that bought RG is another firm like Romney's firm that buys up companies and sells them for parts. They make millions, we loose.

Suggest removal:

2theguins(158 comments)posted 10 months, 2 weeks ago

The end of an era of fully integrated flat rolled steel in the Valley. This company's only intent is to sell the plant for scrap. As they have done with the Sparrows Point facility. Sad day indeed.

Suggest removal:


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