Bethlehem, Fla. Firm In Joint Venture

Object Is To Make Frame Components, Such As Roof Trusses

Sparrows Point To Provide Steel

Steelmaker Is Buying 45% Of Distributor Of Building Materials


April 28, 1997|By Sean Somerville | Sean Somerville,SUN STAFF

Bethlehem Steel Corp.'s Sparrows Point plant stands to benefit from a new joint venture with a Florida building-materials company to expand the use of steel in homes and commercial buildings.

Under the partnership, Bethlehem Steel will purchase 45 percent of Orlando-based Steel Construction Systems, a subsidiary of CSR Rinker, for an undisclosed amount. Sparrows Point will supply the steel for the new venture, Bethlehem Steel said Friday as it announced the deal.

George Silagyi, director of strategic studies for Sparrows Point, said the Baltimore County plant has supplied galvanized sheet steel to Steel Construction Systems since 1995.

The joint venture will not immediately boost production of galvanized sheet steel or employment at Sparrows Point, which has about 5,300 workers.

"What this does is ensure we'll have a ready outlet for galvanized sheet," Silagyi said.

The Sparrows Point plant, which has long supplied coated sheet steel to metal building and components manufacturers, entered the multibillion-dollar framing market last year. Based on the market's potential, the plant converted one of its four coating lines to supply galvanized steel to framing manufacturers.

Finding markets for more expensive steel products is important for Sparrows Point. The plant faces intense competition from mini-mills -- low-cost producers with electric furnaces that use scrap metal as raw product.

Bethlehem is in the middle of a restructuring that will result in the sale or closing of four divisions and cut employment to about 15,000. Curtis H. Barnette, chairman and CEO of Bethlehem, said the joint venture with Steel Construction Systems is consistent with the company's philosophy of growing by "edging out" -- investing in steel-related opportunities.

William Snyder, CEO of CSR Rinker, said steel was beginning to cut into wood's dominance in home construction.

"This joint venture with Bethlehem Steel is one of the ways CSR Rinker plans to grow this market," Snyder said.

CSR Rinker is a unit of CSR America, itself a subsidiary of CSR Ltd. of Sydney, Australia.

The joint venture will expand the current lines of steel framing components to include the design and manufacture of steel roof trusses for new homes in Florida.

Steel Construction Systems employs about 55 in Orlando. The firm distributes through 25 building-materials yards in Florida, a state that accounts for about 10 percent of U.S. housing starts. CSR Rinker's 125 salespeople will sell the joint-venture products, Silagyi said.

He said the venture will target communities south of Orlando, a booming market that is monopolized by wood. He said the sales force will tout steel's advantages: It's cheaper, lightweight, hurricane-resistant and termite-proof.

Pub Date: 4/28/97

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.