Sparrows Point steel mill up for sale – again
Wednesday, 03 October 2012 13:29

Hilco Trading Inc. and Environmental Liability Transfer officially took ownership of the Sparrows Point steel mill on Sept. 12.  photo by Roland Dorsey

Bids on plant to be accepted until Dec. 21

by Nicole Rodman

    Less than two weeks after officially taking over as owners of the steel mill at Sparrows Point, Hilco Trading, Inc. and Environmental Liability Transfer (ELT) announced last week that they are putting the mill back up for sale.
    Indicating that they are interesting in selling the operation whole or in pieces, the owners have set a three-month window during which they will accept bids.
    Bids will be accepted until Friday, Dec. 21. An auction, if necessary, will be held on Thursday, Jan. 3.
    At just under 13 weeks, this bidding period is about three weeks longer than the time frame previous owner RG Steel was given to sell the property.
    Declaring bankruptcy in May after just over a year of ownership, RG Steel sold the plant at auction on Aug. 7.
    With no steelmaking companies bidding on the property, liquidator Hilco Trading and redeveloper ELT secured the mill with a bid of $72.5 million.
    This figure was well below the $810 million the plant fetched in 2008.
    In a statement to The Dundalk Eagle last Thursday, Hilco chief marketing officer Gary Epstein noted that they are shopping the property to potential buyers across the globe.
    “We’re managing the process so that we can provide interested steel operators from around the world with plenty of time to conduct due diligence and get financing in order,” he wrote last week.
    Explaining Hilco’s decision to place the mill back up for sale, Epstein noted,
that “we are evaluating all of our options for the property, which include seeking operators for the mill in its entirety or some of the manufacturing facilities and operations within the 3400-acre complex. 
    He added, “We are also considering the removal and/or resale of industrial equipment and structural demolition followed by the environmental remediation of the site as a precursor to redevelopment.”
    According to Epstein, the site retains great value to potential buyers.
    “Based on our early assessment, we believe the cold-rolled mill complex with its tri-modal transportation capabilities including rare access to a deep water port are extremely valuable and marketable,” Epstein explained.
    For its part, Hilco has vowed to work both with elected leaders and union representatives to ensure that the process goes smoothly.
    As Epstein noted, “We are actively working with local and state leaders and would love to see an operator bid on the facility and help bring employment back to the area.”
    According to a report in the Baltimore Sun, co-owner Environmental Liability Transfer has indicated that the 3,000-acre site is large enough to facilitate steelmaking and redevelopment.
    Members of United Steelworkers Union Local 9477 are hoping to see a new steelmaker buy and reopen the plant.
    “We’re cautiously optimistic and hopeful,” union president Joe Rosel said during a phone interview last Thursday, noting, “Plan A is to sell the plant to a strategic steelmaker to get people back to work.”
    As Rosel explained, he has spoken with the new owners and they have vowed to include the union in the sale process.
    “Hilco said we would be a partner in that,”
Rosel said, adding, “We just think the best solution for Hilco is to sell to a strategic steelmaker. It’s a win-win.”
    Sixth District state Del. John Olzewski Jr. is also hoping that there is a happy ending for steelworkers at Sparrows Point.
    In remarks to The Eagle last Wednesday, Olzewski wrote, “I remain hopeful that there is a buyer in the marketplace that understands the opportunities that exist for successful business operations to resume at the Sparrows Point steel plant, and to see as many displaced workers as possible put back to work.”
    He continued, “Moreover, I continue to push state and local business development staff to explore and pursue every possible way that government might play a role in helping to facilitate such a purchase.”
    His 6th District House colleague Joseph “Sonny” Minnick appeared less confident in the future of steel at the Point, writing in an e-mail to a large mailing list that included The Eagle, “I do not think that site will ever be a steel mill again …. if that was going to happen the Brazilian Company [sic] would have bid on it when it went to auction.”
    While the 2,000 steelworkers laid off from the former RG Steel plant wait to see how the latest developments play out, they face an uncertain economic future, and the status of their unemployment and health benefits remain uncertain.
    According to Rosel, the union is doing everything it can to take care of members.
    “We are going to continue to try to access all agencies and avenues to help members through this trying time,” he explained.
    In addition to helping members sign up for federal and state benefits, the union has been working with the Maryland Food Bank to provide food to steelworkers and their families.
    Last Tuesday and Wednesday, the food bank handed out food to more than 1,700 people who turned out at the United Steelworkers hall on Dundalk Avenue.
    According to the Maryland Food Bank, approximately 60,000 pounds of food was distributed to those affected by the steel mill shutdown.
    According to Rosel, at least four more food bank events will be held, two in November and two in December.
    Bids on the steel mill at Sparrows Point will be accepted until Dec. 21, with an auction, if necessary, to be held on Jan. 3.
    In the meantime, workers can only watch, wait and hope for the best.