Steelworkers Hail Esmark Sale
06/27/2008 - The USW welcomes the news that Esmark has entered into a definitive merger agreement with OAO Severstal, and that Esmark's Board of Directors is recommending that shareholders tender their shares to Severstal.
The United Steelworkers (USW) welcomed the news that Esmark has entered into a definitive merger agreement with OAO Severstal and that Esmark's Board of Directors now recommends that shareholders tender their shares to Severstal.
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“Essar is a strong and admired company with a good business plan and committed management, but we did not reach an agreement with them in this instance.”
Leo W. Gerard
USW International President
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“From the beginning, our support for Severstal was based on the company's willingness to improve upon our current contract and its commitment to invest specific, substantial capital in our plants,” said USW District 1 Director Dave McCall, who chairs the union's Wheeling Pittsburgh Steel negotiating committee. “The synergy of Severstal operating Sparrows Point, WCI, and Esmark as one consolidated company creates a long-term, viable entity, which will obviously provide the most security for our members, their families and our retirees at all of the operations.”
Esmark management had entered into an agreement with Essar on April 30, 2008, violating certain provisions in the company’s agreement with the union. Earlier this week, a third-party arbitrator upheld the "Right to Bid" portion of union's contract and made clear that the April 30 Memorandum of Agreement between Esmark and Essar was to be set aside. Essar Steel, Ltd. has subsequently withdrawn its competing bid for Esmark's stock.
“Essar is a strong and admired company with a good business plan and committed management, but we did not reach an agreement with them in this instance,” said USW International President Leo W. Gerard. “That said, we look forward hopefully to working with them as partners in the future as their North American business grows.”
The USW represents approximately 850,000 workers in a wide variety of industries, as well as the service and public sectors, including about 3000 currently employed at various Wheeling Pittsburgh Steel facilities in Ohio, Pennsylvania, and West Virginia.
