February 9, 2003
PHILADELPHIA -- Bethlehem Steel's board voted unanimously Saturday to sell its mills to International Steel Group, a deal that could bring the once-mighty industrial giant out of bankruptcy and create the nation's largest steelmaker.
Bethlehem has been reviewing a $1.5-billion offer from Cleveland-based ISG since Jan. 6, and the companies reached an agreement in principle last week after chief executive Robert Miller said he and financial advisers agreed it was "the best value achievable."
The deal will be submitted in one or two weeks to U.S. Bankruptcy Court in New York, Miller said.
"This sale will provide a new beginning for our employees and our operations, which will continue without interruption during the change of ownership," Miller said.
Pushing to wrap up the deal by April, Bethlehem Steel caused a stir Friday when it said it was seeking in bankruptcy court to terminate health and life insurance benefits for 95,000 retirees and their dependents on March 31.
The United Steelworkers of America called the plan "morally callous," and union officials and other retiree representatives said they would try to negotiate a later termination date as they try to get alternate plans in place.
Miller said the end of the bankruptcy process was an appropriate time to end the benefits, which he said would have been terminated whether Bethlehem had sold its assets or been reorganized as a stand-alone company.
"Regrettably, expectations of lifelong benefits were made during an era when health care costs were lower and the company's financial condition was stronger," he said.
Adding Bethlehem Steel's plants would make ISG the largest U.S. steelmaker with an annual production capacity of 16-million tons.