Wheeling-Pittsburgh Steel Bankrupt

Friday, November 17th 2000, 12:00 am

By: News On 6

Wheeling-Pittsburgh Steel Corp., facing tough competition from overseas steel producers, has sought protection from its creditors under Chapter 11 of the federal bankruptcy laws.

In filings late Thursday in a federal court in Youngstown, Ohio, the company said it will continue normal business operations while it develops a reorganization plan, with no disruptions in orders or deliveries. No layoffs or plant closures are planned.

``We have requested and expect to pay all salaries, wages, pensions and benefits'' through interim financing, president and chief executive James G. Bradley said.

Wheeling-Pitt, a subsidiary of WHX Corp., is the nation's ninth-largest integrated steel producer and has some 4,800 employees at plants in Ohio, Pennsylvania and West Virginia. Its Wheeling Corrugating Division has 16 plants located throughout the country.

If court approval is granted, Citibank will give Wheeling-Pitt $290 million in financing to continue operations during the restructuring, the company said.

The company's headquarters are in Wheeling, W. Va., but the filing was in Youngstown because the court is in a steel town familiar with bankruptcies and the struggles of the steel industry, Bradley said.

Earlier in the day, Bradley and other Wheeling-Pitt leaders met with union officials and management employees to assure them there would be no immediate layoffs.

Bernie Ravasio, president of United Steelworkers of America Local No. 1190 in Steubenville, Ohio, said his 2,200 members in West Virginia and Ohio expected the bankruptcy filing but were happy to hear about the operational loan.

``Most people are relieved the uncertainty is over,'' he said. Many workers had feared they would be laid off.

Ravasio said Bradley also assured the union that Wheeling-Pitt would ask the bankruptcy judge to retain the provisions of the USWA's current contract, which does not expire until Sept. 1, 2002.

``I believe the company's handled it very well,'' he said. ``The company is willing to cooperate with the workers, and Bradley recognized the tremendous effort our workers gave during our outage. He was very complimentary of our work.''

Wheeling-Pitt, like other domestic steelmakers, has struggled with competition from foreign producers that began flooding the U.S. market with steel in 1998. By the end of that year, a record 41.5 million tons had been sold in the U.S. market at prices domestic manufacturers argue are below the cost of production.

Industry leaders project the figure for 2000 may reach 41 million tons by year's end.

Bradley blamed the crisis for the bankruptcy filing, faulting the U.S. government for failing to stem the flood of imports. Since the crisis began, at least six other U.S. mills have declared bankruptcy, and thousands of workers have been laid off.

``The problem with a Chapter 11 is it has a stigma attached to it, and the stigma usually says that we have failed,'' Bradley said. ``In this case, employees of Wheeling-Pittsburgh have not failed. The situation is 100 percent due to the failure of the U.S. government to level the playing field and to eliminate illegally dumped foreign steel.''

Wheeling-Pitt endured one the longest walkouts ever against a major U.S. steelmaker three years ago with a 10-month strike by 4,500 workers in West Virginia, Pennsylvania and Ohio. It ended in August 1997, and the company incurred some $116 million in losses.

It was trying to rebound from the strike just as the import crisis peaked.

For the first six months of 2000, Wheeling-Pitt reported net income of $28.8 million, compared with a loss of $25.7 million for the first half of 1999.

Thursday's bankruptcy petitions come on the heels of a reshuffling of the Wheeling-Pitt board that ousted James Bowen, president of the West Virginia AFL-CIO, and eliminated the seat held by former United Steelworkers of America president Lynn Williams.

West Virginia's other producer, Weirton Steel Corp., called the bankruptcy ``very unfortunate.'' The two Northern Panhandle companies have on occasion discussed a possible merger, but they never forged an agreement.

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On the Web:

Wheeling-Pittsburgh Steel Corp: http://www.wpsc.com/