Yard deal still alive Deadline passes, but Veritas, Beth Steel continue talking

Shipbuilding

October 01, 1997|By Sean Somerville | Sean Somerville,SUN STAFF

Veritas Capital Inc. and Bethlehem Steel Corp. yesterday continued work to complete the sale of Bethlehem's Sparrows Point shipyard, missing the Sept. 30 deadline announced last month.

Tom Campbell, co-founder of Veritas, said that much of the work that remains is routine and that the deal could be finished as early as today. But he added, "There's a couple of issues outstanding."

He declined to identify the issues. Jim Lautar, a leader in the union that represents most of the yard's roughly 900 workers, said Veritas and the state are -discussing the timing of disbursements from a state economic development package. "Veritas is waiting for the state to finish their part," said Lautar, grand lodge representative of the Industrial Union of Marine & Shipbuilding Workers of America/International Association of Machinists and Aerospace Workers.

A Bethlehem spokesman said only that the two sides are still working on the deal.

State economic development officials declined to comment. "We would wait until something is final," said Andy Spitzler, a spokesman for the state Department of Business and Economic Development.

Although no purchase price has been disclosed, sources have said Veritas, a New York-based merchant banking fund, will pay about $15 million for the yard.

When the deal was announced last month, James T. Brady, state Business and Economic Development secretary, said Maryland would contribute a financing package of about $4.5 million. The BethShip Inc. yard will be closed if it isn't sold.

Failure to close the deal yesterday discouraged union officials, who witnessed the collapse of two earlier deals. "We've come too far to slip now," Lautar said.

The yard is scheduled to work on a cruise ship, Royal Majesty, at the end of October.

Campbell said the yard plans to send representatives all over the United States and overseas to drum up business.

He also said Veritas aims to have enough work to support about 250 workers within six months. For now, though, customers remain reluctant to commit work to the yard. "I think it's fair to say that people are waiting for the deal to happen," Campbell said.

Pub Date: 10/01/97

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