It’s now official: Sparrows Point’s new owner is RG Steel
RG Steel confirmed tonight what readers of The Brew knew yesterday – that the company completed its purchase of the Sparrows Point, Warren and Wheeling steel mills from Severstal North America.
RG Steel further confirmed an earlier Brew report that the company plans to resume steelmaking operations at Sparrows Point and expects to reopen the “L” blast furnace, basic oxygen furnaces and hot-strip mill in May.
The fate of the Wheeling facilities at Steubenville and Mingo Junction, Ohio – both shut for nearly two years, leaving more than 2,000 without work – was not disclosed in tonight’s release.
Here's the just-issued logo for RG Steel – a yellow and red rising sun.
It is widely believed that the facilities will remain closed at least until Sparrows Point is up and running.
The company also didn’t provide any information about its future plans for Warren, which has been operating steadily for the last eight months under Severstal.
As part of the sale priced at $1.2 billion, RG Steel has acquired the Wheeling Corrugating Co. and 50% ownership of the Mountain State cokemaking plant at Follansbee, W.Va., and Ohio Coatings in Yorkville, Ohio.
“We Have the Will to Succeed”
Tonight John Goodwin, president and CEO of RG Steel, said: “Our plan for RG Steel is to become the leader in the manufacture and supply of flat-rolled steel and to provide exceptional customer service. We have the facilities, we have the capital, we have the talent and we have the will to succeed. Our plants and our products are well known in our markets, and we will capitalize on our strengths to become the leading producer of flat-rolled steel in the U.S.”
The company disclosed that Well Fargo Capital Finance and GE Capital have structured a four-year $750-million syndicated credit facility to handle the sale.
RG Steel is a subsidiary of The Renco Group, which is controlled by New York billionaire Ira Rennert. The Rennert group signed a contract last January with United Steelworkers (USW) negotiators, but the contract has not yet been distributed to members or ratified through a mail-in ballot.
As a result, employees at Sparrows Point and elsewhere will work for now under the expired Severstal contract, sources tell this website.