Esmark is testing the waters regarding the purchase of the Mittal steel mill on Sparrows Point ? and just might dive in.
“We have expressed our interest in the property to Mittal,” Esmark spokesman Bill Keegan said. “We have been doing so ever since the Department of Justice Ruled.”
While no formal offer has been made, Esmark has remained the most vocal of what Keegan described as “a number of other bidders.”
Processing 500,000 tons of tin and 3.9 million tons of raw steel annually, the mill is an attractive asset not only because of its productivity, but its coveted location next to the open ocean. Building a plant with as good a set-up as what Sparrows Point has is just not an economically efficient option for most companies.
“It takes a couple to three years to put in a facility as large as Sparrows Point,” Global Insights steel analyst John Anton said. “Plus you have to comply with the Environmental Protection Agency and lots of environment regulations and local rules.”
Owned by Mittal Steel, the mill became a topic of conversation several months ago when Mittal merged with European steel business Arcelor SA. Through a $33 billion transaction, the two companies joined to become what the Department of Justice?s Antitrust Division viewed as a threat to other businesses, The Examiner reported on Feb. 21.
Originally, the government told Mittal to choose between selling its Weirton, W.Va., mill or the one at Sparrows Point. Keegan told The Examiner that Esmark had tendered an offer to Mittal for the Weirton location, but that offer became void when the Department of Justice took the selling decision out of Mittal?s hands and ordered it to sell the Sparrows Point location.
Esmark is finishing a merger to buy Wheeling-Pittsburgh Steel Corp.
