Veritas Capital Inc. executives will visit Bethlehem Steel Corp.'s Pennsylvania headquarters today in an attempt to seal a deal for the purchase of Bethlehem's Sparrows Point shipyard, according to sources.
Bethlehem and Veritas would not comment on the planned meeting. The New York-based merchant banking fund has offered about $15 million for the BethShip Inc. yard, according to sources who have insisted on anonymity.
Union officials said they hoped that the two sides could reach a definitive sales agreement by the end of the week, with plans to consummate the deal by the third week in September.
Murphy Thornton, president of Local Lodge S-33 of the Industrial Union of Marine and Shipbuilding Workers, said he has had contact with Bethlehem and Veritas.
"Everybody we've been talking to is upbeat," he said. "I hope this is the last go-round."
The dormant yard's 900 workers have seen two potential buyers come and go since the company announced in October that it would sell or close the marginally profitable shipyard.
The meeting suggests that Bethlehem, which was first seeking $30 million for the yard, might be receptive to Veritas' offer.
WHX Corp., the owner of Wheeling-Pittsburgh Steel Co., which recently ended a 10-month strike, failed to reach an agreement with workers. Peter G. Angelos, Baltimore Orioles chief executive and an attorney, said concerns about liability for possible environmental contamination at the site killed his deal.
Only about 20 workers remain at the yard, as Bethlehem proceeds with plans to close the yard and sell its assets.
Members of Local Lodge S-33 of the Industrial Union of Marine and Shipbuilding Workers last week ratified a contract with Veritas by a vote of 230-62. The contract calls for workers, who are paid an average of $13.47 an hour, to take a pay cut of 75 cents.
Many workers supported the contract because they viewed Veritas as the yard's last chance for survival. "I've gotten about 130 to 140 calls since the vote, asking what's going on," Thornton said.
Veritas, which was founded in 1992 by financiers Tom Campbell and Bob McKeon, aims to buy manufacturing companies, turn them around and sell them at a profit.
Veritas offered between $20 million and $25 million for BethShip Inc. during the first round of bidding for the yard early this year.
But WHX won negotiating rights, followed by Angelos.
The fund's past deals include the purchase in 1994 of Bethlehem Steel's bar, rod and wire facilities in Johnstown, Pa., and in Lackawanna, N.Y., both of which had been shut down for two years. Last year, Veritas bought Bliss & Laughlin Industries Inc., a Harvey, Ill.-based manufacturer of steel bars, for $37.7 million.
Campbell, who would not comment on the yard when reached last week, has said he's impressed with the shipyard and its management team.
The yard last spring stopped taking work beyond the end of June. Union officials say they are anxious to start seeking new repair work.
"We have customers we have satisfied over the years," Thornton said. "They need work all the time. Once we get the garage open again, some of them are going to say, 'OK, we're coming.' "
Pub Date: 8/25/97
