Cyclops merging with Armco division

January 17, 1991

Armco Inc. and Cyclops Industries, Inc., both manufacturers of stainless steel, have announced an agreement in principle for Cyclops to merge with a new wholly-owned subsidiary of Armco.

Both Armco and Cyclops have operations in Baltimore. Lee Bland, an Armco spokesman, said the merger would not affect the local companies, which make different kinds of stainless steel products.

Eastern Stainless Corp., a subsidiary of Cyclops, makes stainless plate at a plant on Rolling Mill Road.

Baltimore Specialty Steels Corp., a subsidiary of Armco, makes stainless bar rod and wire, at a plant on Biddle Street.

Under the agreement, Armco would pay $22 a share or approximately $156 million for the 7.1 million outstanding shares of Cyclops common stock.

To fund a portion of the merger cost, Armco also announced an agreement in principle with New York-based Alleghany Corp., a financial services company and a substantial Cyclops stockholder, to sell Alleghany $100 million of a new Armco 10 percent convertible preferred stock.

Rick Stephan, a steel-industry analyst for Moody's Investor Research, a bond rating fir in New York, said the announcement made him consider downgrading Armco's bonds.

The Eastern Stainless Steel plant reported earnings of $400,000 in the third fiscal quarter, down 87 percent from a year ago.

Armco has 10,500 employees and is the nation's sixth-largest steelmaker.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.