Russian steelmaker OAO Severstal has agreed to buy the Sparrows Point steel plant in Baltimore County for $810 million in cash, the company announced early this morning.
The Russian firm will purchase the mill from ArcelorMittal, which was ordered by the U.S. Department of Justice to divest the plant in February 2007. OAO Severstal. will be the plant?s fourth owner in four years.
“With Sparrows Point, Severstal brings into its U.S. portfolio an asset with significant existing value as well as unlocked growth potential,” Severstal CEO Alexei Mordashov said in a statement.
Severstal also has operations in Dearborn, Mich., and Columbus, Miss..
The company said it has entered into a collective bargaining agreement with the United Steel Workers Union. The sale is subject to regulatory approval, and is expected to close in the second quarter of this year.
A $1.35 billion sale agreement reached with a group of investors led by Chicago-based Esmark, Inc. fell apart in mid-December. At the time, union officials said delays by ArcelorMittal in negotiating union benefits spurred a disagreement between the Esmark and its international strategic partners doomed the deal.
