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Esmark Responds to ‘Frivolous’ ArcelorMittal Lawsuit
05/12/2008 - Esmark indicates surprise and disappointment in response to ArcelorMittal’s suit against Esmark and E2 Acquisition for breach of their contract to purchase the Sparrows Point steelmaking facility.
Esmark Inc. released a statement Friday, May 9, in response to ArcelorMittal’s announcement that it had filed suit in the Supreme Court of the State of New York against Esmark and E2 Acquisition Corp. for breach of their contract to purchase the Sparrows Point steelmaking facility from ArcelorMittal.
In the statement, Esmark indicated its surprise and disappointment that “ArcelorMittal would file such a frivolous lawsuit,” particularly in light of the circumstances surrounding the termination of the Sparrows Point sale agreement.
Esmark also stated its belief that any claims arising out of the contemplated Sparrows Point transaction are without merit for a number of reasons, including:
- Esmark is not a party to agreements with ArcelorMittal pertaining to the proposed Sparrows Point transactions.
- ArcelorMittal had failed to meet various conditions that were required to close the transaction.
- ArcelorMittal had failed to resolve outstanding disputes it had with the United Steelworkers pertaining to the proposed sale.
- ArcelorMittal had failed to obtain the required consent of the United Steelworkers.
Esmark noted evidence of ArcelorMittal’s lack of agreement with the United Steelworkers in the company’s November 14, 2007 earnings release, where it was stated that the Sparrows Point transaction was ‘still pending approval of the United Steelworkers.
Esmark said that it would “vigorously defend against the lawsuit and pursue any claims it has against ArcelorMittal”.
Esmark Inc. is a vertically integrated steel producer and distributor, combining steel production capabilities through both blast furnace and electric arc furnace technologies with the just-in-time delivery of value-added steel products to a broad customer base concentrated in the Ohio Valley and Midwest regions. Currently headquartered in Wheeling, W.Va., the company produces carbon flat-rolled products for a range of applications, with products including hot rolled, cold rolled, hot dipped galvanized, electro-galvanized, black plate and electrolytic tinplate.
