ISG Intends to Purchase Georgetown Steel

[AP / M.R. KROPKO, AP Business Writer]

CLEVELAND (AP) -- International Steel Group Inc. said on
Tuesday it intends to acquire Georgetown Steel Co., a maker of steel
wire rod products, for $16 million plus liabilities.
Georgetown Steel, based in Georgetown, S.C., filed for
Chapter 11 bankruptcy protection in October and stopped production.
ISG plans to restart operations at the plant in the third quarter.
Talks have started with the United Steelworkers of America regarding
a labor contract.
Brian Kurtz, ISG vice president and treasurer, said the cost
of the assumed liabilities likely would be $3 million to $4 million.
He had no estimate on the eventual size of the work force.
Georgetown Steel employed 500 when it shut down.
The deal for the company is subject to U.S. Bankruptcy Court
approval. The board of both companies have approved it. ISG expects
the acquisition to close in June.
The Georgetown Steel plant's wire rods are used for wire,
wire ropes, tire cord and springs.
"Rod market demand is strong and we believe that this
acquisition offers opportunities similar to those we have achieved
with our other acquisitions," said Rodney B. Mott, ISG's president
and chief executive.
ISG last week made progress toward completing a $237.5
million acquisition of Weirton Steel Corp. by reaching a tentative
settlement with creditors who have tried repeatedly to stop that
deal.
The Weirton Steel deal would make ISG the No. 1 domestic
integrated steelmaker.
ISG, based in Richfield, Ohio, in April reported
first-quarter earnings of $70.9 million, or 68 cents per share, on
sales of $1.7 billion.
ISG was formed in 2002 by New York-based WL Ross & Co.'s
acquisition of LTV Corp. steel plants in bankruptcy. Since then, ISG
has grown through acquisition of Acme Metals and Bethlehem Steel.
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On the Net:
ISG: www.intlsteel.com