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Esmark acquires RG Steel's Yorkville CR finishing mill
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Sunday, 14 Oct 2012
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Esmark Inc and its wholly owned steel services subsidiary, Esmark Steel Group, announced that the company has closed into escrow on the transaction for RG Steel LLC's Yorkville cold rolled finishing mill and RG Steel's 50% interest in Ohio Coatings Company's tin plate production facility.

Esmark expects the two acquisitions to accomplish its goal of achieving and returning the company to USD 1 billion in revenue in 2013, enhance shareholder value and complement its leadership position in the US cold rolled marketplace.

In making the announcement, Esmark founder, chairman & CEO Mr James P Bouchard said that the company plans to invest more than USD 15 million in working capital for steel purchases and supplies to restart the Yorkville facility in January 2013 and will rename the company Ohio Cold Rolling Company. The newly named facility will be majority owned and operated by Esmark Steel Group. Ohio Coatings Company will become a 50:50 JV between Esmark and South Korea's TCC Steel.

Mr Bouchard said that "The imminent closing of this transaction is very welcome news to the Ohio Valley and we are extremely pleased to be able to revive one of Wheeling Pittsburgh Steel Corporation’s iconic facilities and bring back sorely needed jobs. We believe we have a unique opportunity to operate Yorkville and Ohio Coatings Company as truly independent facilities not tethered to a steel producer, which will allow the two companies to operate more efficiently and better execute their strategies moving forward."

Mr Bouchard recognized the significant collaboration between Esmark Steel Group, TCC Steel, the United Steelworkers of America and the State of Ohio in reaching agreement to successfully close the transaction. He added that "Our longstanding partnerships and strong working relationships with TCC's leadership, the USW, and the current managers and personnel associated with the Yorkville and OCC assets are key factors in closing this transaction. Together with a new Yorkville labor contract and new supply agreements and energy contracts, we will be well positioned to capitalize on the market as the economy improves."

Mr Bouchard thanked Ohio Governor Mr John R Kasich, US Senator Mr Sherrod Brown and JobsOhio for their ongoing counsel and assistance to Esmark during the acquisition process.

Esmark Steel Group CEO Mr Tom Modrowski, who led the company's efforts to acquire the RG Steel assets, said that "We've been working closely with the U.S. EPA, the Ohio EPA and local government authorities to develop a remediation plan for Yorkville that addresses certain environmental issues. We especially want to thank Ohio EPA Director Mr Scott J Nally and his team for their extraordinary efforts in helping us achieve this objective."

Esmark and the USW Achieve Collective Bargaining Agreement for Yorkville Workers

Additionally, Mr Modrowski said Esmark has agreed to terms for a new collective bargaining agreement at Yorkville with the United Steelworkers of America. He added that "We want to thank USW District 1 Director Mr Dave McCall and his team for their collaboration in reaching this contract agreement. Our expectation is to initially recall approximately 160 union workers as the Yorkville restart operations begin in January 2013, with the hope of adding more workers as our monthly volume increases. We are looking forward to rolling our first steel coils at Yorkville and supplying Ohio Coatings and our other customers with quality products."

Source - Esmark

(www.steelguru.com)

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