HAGERSTOWN, Md. (AP) — The owner and the prospective buyer of the Sparrows Point steel mill worked into the night to avert a potential collapse of the $1.35 billion deal affecting about 2,500 workers in the Baltimore area.
Steel distributor Esmark Inc. of Chicago Heights, Ill., and mill owner Mittal Steel Co. NV of the Netherlands were silent early Tuesday on whether they had met a self-imposed midnight deadline for saving the deal they announced in early August.
Esmark operates Wheeling-Pittsburgh Steel, which has operations in West Virginia, Pennsylvania and Ohio. Mittal owns the former Weirton Steel operation in Weirton, W.Va.
Financing for the transaction was thrown into doubt Nov. 30, when Esmark's agreements with its international partners lapsed due to delays. Esmark President Craig T. Bouchard, who heads prospective buyer E2 Acquisition Corp., said the investors remained committed to the deal but indicated new partners might be added.
The original partners were Franklin Templeton Investments of San Mateo, Calif.; Industrial Union of Donbass Corp., a Ukrainian steel company; and Vale, a Brazilian mining company previously called Companhia Vale do Rio Doce, or CVRD.
Bouchard blamed the delays on the lack of an agreement between Mittal and the United Steelworkers union covering benefits for the plant's 84,000 retirees — an obligation Bouchard said Mittal inherited when it bought Sparrows Point in 2005.
But Mittal spokesman William Steers said Monday that those discussions were not preventing Mittal from closing on the deal.
Failure to finalize the deal could prompt court-appointed trustee Joseph G. Krauss to seek another buyer for the mill, Krauss said Monday.
Mittal agreed to sell Sparrows Point to E2 to resolve antitrust concerns raised by the U.S. Justice Department stemming from Mittal's planned $41 billion acquisition of Arcelor SA of Luxembourg, which would create the world's largest steelmaker, ArcelorMittal.