Wheeling-Pittsburgh Steel

Wheeling-Pittsburgh Steel Corporation

Wheeling-Pittsburgh Steel Building, in downtown Wheeling, West Virginia.
Industry	Metals
Successor	RG Steel, LLC (bankrupt entity)
Founded	1920
Headquarters	Pittsburgh, Pennsylvania (1920-Aug. 22, 1986)[1] Wheeling, West Virginia (Aug. 1986-2013)
Products	raw steel galvanized steel substrate steel coils bridge building sheet metal tin coke
Revenue	liquidated
Website	www.rg-steel.com

Wheeling-Pittsburgh Steel was a steel manufacturer based in Wheeling, West Virginia, which is located at the southern edge of the Pittsburgh metropolitan area.

History

In December 1968, Pittsburgh Steel Company was merged into Wheeling Steel Corporation to form Wheeling-Pittsburgh Steel Corporation, or the Wheeling-Pitt. The company had six major manufacturing centers in Eastern Ohio, the Northern Panhandle of West Virginia, and Western Pennsylvania.

While the company operated only a limited number of plants, the corporation was able to turn out a high number of products due to efficiency. Each of Wheeling-Pittsburgh's six plants turned out a different type of product.

• Raw steel, which can be manufactured in a variety of thicknesses, and may be rolled or coiled, was created in Steubenville, Ohio.
• Steel mill, originally Pittsburgh Steel Company, in Monessen, Pennsylvania.
• In Yorkville, Ohio, the company produced tin products, specifically coatings.
• Galvanized steel, marketed under the SofTite name, was produced at a Martins Ferry, Ohio plant.
• Located near the main headquarters in Wheeling was a plant that specialized in steel for bridge and highway construction.
• Sheet steel was produced in an Allenport, Pennsylvania plant.
• The company gathered the coke that is required for steel production at a Follansbee, West Virginia plant.

Decline

Although,Wheeling-Pittsburgh had some strong facilities, e.g. a good hot strip mill, the overall configuration with multiple locations spread mostly along the Ohio River created inefficiencies. Wheeling-Pittsburgh principally made commodity grade flat rolled steel much of it simply sold as hot band, which did not permit much pricing power. Its location near metallurgical coal mines and its own coking capacity gave it a competitive advantage in coke, but ultimately this was more than offset by the high logistical cost of bringing in iron ore. Ultimately, the fate of Wheeling-Pittsburgh followed the boom/bust cycle of the American steel industry, with the busts becoming more pronounced. With its high fixed-cost blast furnace configuration and unionized work force, limited-pricing power, the downturns resulted in several bankruptcy filings. In addition to the structural problems faced by Wheeling-Pittsburgh, there were some disastrous decisions with regards to large capital projects that sealed its fate. A late attempt to use a hybrid steel making method - blast furnace and an untried electric arc furnace design didn't work when the new electric arc furnace didn't achieve its designed capacity. In hindsight - a merger of Wheeling-Pittsburgh Steel and nearby Weirton Steel, which could never happen because of the different union/employee and ownership structures, would have improved the likelihood that a merged entity could have been competitive and survived in some form. The only significant surviving operations from both entities is the Coking facility from Wheeling-Pittsburgh in Follansbee West Virginia and the tin mill from Weirton Steel in Weirton West Virigina..

Esmark

Esmark, Inc., engaged in a successful proxy takeover battle for Wheeling-Pitt in 2005 and formally took over the steelmaker in November 2007.^[2] Despite endless promises of job saving, delays in financial reporting, and any number of claimed mergers and acquisitions that never saw the light of day, the new owners nearly drove the company into bankruptcy until a bridge loan from Essar Steel of India provided a lifeline.

Severstal

In August 2008, Russian steelmaker Severstal acquired Esmark's Wheeling-Pitt steel holdings for $1.25 billion.^[2]

RG Steel—Renco Group

In 2011, RG Steel, a unit of the Renco Group, acquired Wheeling-Pittsburgh from Severstal.^[3] On May 31, 2012, RG Steel filed for Chapter 11 bankruptcy in the United States Bankruptcy Court for the District of Delaware. ^[4] The company sent notices to all 4000 RG Steel employees that they may be laid off, with layoffs beginning on June 4, 2012.^[5]

Bankruptcy liquidations

After Chapter 11 bankruptcy and RG Steel liquidation, the Yorkville, Ohio plant was sold back to Esmark, the Martins Ferry, Ohio plant was sold to a local businessman, and the Steubenville, Ohio plant was sold to the metal recycler Herman Strauss.^[6]

Notes