Beth Steel completes Lukens assets sale Allegheny Teledyne pays $175 million to run mills


November 21, 1998|By BLOOMBERG NEWS

BETHLEHEM, Pa. -- Bethlehem Steel Corp., the No. 3 U.S. steelmaker, said yesterday that it completed the sale of the former Lukens Inc.'s stainless steel assets to Allegheny Teledyne Inc. for $175 million.

The companies also said they will spend $25 million to improve a former Lukens mill in Conshohocken, Pa. Bethlehem will retain ownership of the mill and allow Allegheny Teledyne exclusive use of it for 20 years.

Pittsburgh-based Allegheny Teledyne, the world's largest specialty-metals producers, agreed to walk away from a bidding war for Lukens in January in exchange for the stainless-steel assets. The assets include melting and hot-rolling mills at a plant in Houston, Pa., and steel-processing lines at a plant in Massillon, Ohio.

Before completing the transaction with Allegheny Teledyne, Bethlehem said it would lay off 650 workers for two weeks, starting Monday, at the mills in Houston and Massillon, in addition to another former Lukens mill in Washington, Pa.

Allegheny Teledyne officials weren't immediately available to comment on whether the sale completion affects the layoffs. Bethlehem said the two-week shutdown is in response to stainless steel imports, which have risen 12 percent this year through August from the year-ago period and took orders away from U.S. mills.

Bethlehem is still looking for buyers for the Massillon and Washington plants, as well as a stainless-steel distribution business based in Buffalo Grove, Ill.

Allegheny Teledyne paid Bethlehem $105 million in cash and issued a note for the remaining $70 million. It also agreed to pay up to $9 million for the improvements at the Conshohocken mill; Bethlehem will invest the rest.

Pub Date: 11/21/98

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