Bethlehem splits main steel units Company hopes to return to profitability

January 19, 1993|By Ross Hetrick | Ross Hetrick,Staff Writer

Bethlehem Steel Corp. split its two main steelmakin operations into separate business units yesterday and named Duane R. Dunham, the company's marketing vice president, to be president of the Sparrows Point Steel Mill in Baltimore County.

The operations will be known as the Bethlehem Sparrows Point Division and the Bethlehem Burns Harbor Division. Burns Harbor is in Indiana, 40 miles southeast of Chicago. Each unit will be responsible for its own marketing, operation and financial performance, the company said.

"We are making this strategic decision to serve our customer and markets more effectively and to increase each division's accountability for its performance, quality, service and profitability," Curtis H. Barnette, Bethlehem's chairman and chief executive, said at a news conference in Bethlehem, Pa.

Also, between 50 and 60 people in the company's marketing department in Bethlehem will be transferred to the two plants, Mr. Barnette said. These transfers would not be evenly divided between the two plants, he said.

Mr. Barnette said the goals of the two plants would be "to achieve profitability on a sustained basis . . . promptly." Bethlehem has lost money for the past three years.

Burns Harbor, built in the 1960s, is a more modern and efficient plant than the 100-year-old Sparrows Point operation, which has been blamed for much of Bethlehem's recent losses, say analysts who track the company.

Mr. Dunham, the new Sparrows Point president, joined the companyin 1965 as a management trainee and has held various positions in the company's sales department, becoming general manager of marketing in 1988 and then vice president of marketing in 1990.

Other top officials at the new Sparrows Point operation will include: Carl W. Johnson, vice president of operations; Lawrence N. Blake, vice president of marketing; David K. Schoenen, controller; and Clifford W. Ishmael, manager of human resources.

Mr. Johnson, a 29-year Bethlehem veteran, had been the top official at Sparrows Point since August, when he was appointed vice president and general manager.

About 80 percent of Bethlehem's revenues are generated by Sparrows Point and Burns Harbor. Sparrows Point, which has about $1.5 billion in annual sales, produces about 3 million tons of steel sheet and plate products annually and has about 5,800 workers.

For several months, Bethlehem has been considering creating separate business units at each of its steel mills at Sparrows Point, Burns Harbor, Bethlehem and Steelton, Pa.

The first step came in early December when the company created Pennsylvania Steel Technologies Inc. to run its steel plant in Steelton, which makes railroad rails, pipe and semifinished steel products.

But unlike Sparrows Point and Burns Harbor, which are divisions within Bethlehem's corporate structure, the Steelton operation was incorporated separately and has its own five-person board of directors.

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