SeverStal Shuffles SeverCorr Management Team, Pushes for Ownership
01/03/2008 - SeverStal announces that SeverCorr CEO John Correnti and other founding senior managers will transition executive management of SeverCorr to SeverStal.
SeverStal has announced that SeverCorr CEO John Correnti and other founding senior managers will “transition executive management of SeverCorr to SeverStal”.
The statement follows previous announcements by Severstal that it would consolidate SeverCorr as a SeverStal company. Severstal had also stated its intentions to purchase the SeverCorr ownership interests held by John Correnti and other members of the executive management team.
“John Correnti and his team have been tremendous partners and we wish them the very best in the future,” said SeverStal CEO Alexey Mordashov, commenting on the announcement. “In a relatively short period, they built from scratch one of the most technologically advanced mills in the steel industry that is strategically located to serve the fast growing Southern region of the U.S.
SeverStal has already established a new senior management team at SeverCorr, including the appointment of James Hrusovsky as the new CEO, and Sergei Kuznetsov as the new Chief Financial Officer. Hrusovsky, whose career spans more than 26 years of strategic and operational experience, formerly served the company as Chief Operating officer of SeverStal North America, Inc. Kuznetsov, who was presently serves as Severstal North America’s Chief Financial Officer, has twelve years of industry experience. He will have financial management and reporting responsibilities for both SeverCorr and SeverStal North America and will remain based in Dearborn, Mich.
To ensure the Columbus, Miss., based company’s success, Severstal said it will leverage its track record of operational excellence and its experience in acquiring and integrating high-quality assets in both North America and Europe.
“SeverStal remains committed to John’s vision and to SeverCorr’s employees, customers, partners, and the Golden Triangle region and state of Mississippi,” continued Mordashov. “We are fully focused on delivering a seamless and cooperative transition. With the new management team in place, we are well positioned to lead SeverCorr into the next stage of its development and deliver value to all stakeholders.”
Severstal does not expect the executive management team transition and anticipated change of ownership structure to have any impact on SeverCorr’s operations. Under the leadership of the new team and other senior operational managers that will remain in place, SeverCorr is to continue its successful production ramp-up. The facility’s Phase II expansion, which will more than double the mill’s output to 3 million tonnes, is on track to be completed by late 2010.
“We’re proud of what we’ve accomplished at SeverCorr,” said John Correnti, “and I want to thank everyone who has helped make it possible. As SeverCorr moves from an entrepreneurial venture into an operating steel mill, it made sense for me and other founding senior managers to transition executive management responsibilities. SeverStal was a valuable partner in getting this mill to where it is today.”
SeverCorr is a unique mill that combines scrap-metal-based electric arc furnace steelmaking with finishing processes that are more typical of an integrated plant. It is located near a number of large steel customers, making the distribution channels more efficient. SeverCorr complements SeverStal’s other U.S. business, Dearborn, Mich., based SeverStal North America, which primarily serves the manufacturing hub of the Midwest U.S.
According to SeverStal, full consolidation of SeverCorr financials will begin in the first quarter of 2008.
Incorporated in 1993, OAO SeverStal is an international steel producer focused on high-value-added and unique niche products. The company has a successful track record of acquiring and integrating high-quality assets in North America and Europe. SeverStal also owns mining assets in Russia, thus securing its own supply of raw materials. In 2006, SeverStal produced 17.6 million tonnes of steel and had revenues of $12.4 billion, PBT of $1.8 billion, and EPS of $1.27.
