The local that represents workers at Sparrows Point is questioning the sale of the plant to an investment group led by Chicago-based Esmark Inc.
United Steelworkers Local 9477 President John Cirri said yesterday that he sent a formal letter to the international union body - which had petitioned the Justice Department on Esmark's behalf to approve the deal - asking it to reconsider its support of the sale.
Esmark and a group of investors and suppliers formed E2 Acquisition Corp. to purchase Sparrows Point from Mittal Steel Co. NV, of the Netherlands.
Mittal was forced by the Justice Department to sell the Baltimore County mill to satisfy antitrust concerns related to its $38 billion merger with Luxembourg-based Arcelor SA.
Cirri said he and his members have been "left in the dark" over the transaction, which is taking longer than expected. And he said he is concerned about E2's strategy for Sparrows Point, making it the main supplier of slab to the twice-bankrupt Wheeling- Pittsburgh Corp., which Esmark is in the process of buying.
"Maybe this sale isn't the best thing for Sparrows Point," he said.
Gary Hubbard, a spokesman for the United Steelworkers, confirmed that the international received an e-mail from Cirri.
However, Hubbard said he could not comment on it, noting confidentiality agreements related to the continuing negotiations over the sale.
The USW could still block the sale because of a clause in their contract with Mittal. The Justice Department also must be persuaded to approve the terms of the final deal.
Craig T. Bouchard, who co-founded the metals distributor Esmark with his brother James, said he understands the local's angst about the deal, which has taken almost a year to put together.
E2 will be Sparrows Point's fourth owner in four years.
However, Bouchard, who is chairman and chief executive officer of E2, said it would be inappropriate for him to share details of the deal with workers because their plant is still owned by Mittal. "We've said we are not cutting any jobs at Sparrows Point," said Bouchard, who plans on visiting the plant today. "The question is how jobs will be created at Sparrows Point."
E2 will "de-emphasize" the hot mill in favor of expanding the one at Wheeling-Pitt, Bouchard said, but will increase Sparrows Point's capacity to produce slab for not only Wheeling-Pitt but for other customers, including Mittal. Until now, he said, the plant has only produced slab for its own use and for Mittal. He also wants to boost production at the plant's recently built cold mill and tin mill.
"Wheeling is capable of being a very large slab consumer. Sparrows Point is capable of being a very large slab producer. It's a win-win," Bouchard said yesterday.
During a visit to Sparrows Point in September, Bouchard told workers the plant was the "mother ship" of Esmark's growing chain of steel companies. Under Mittal, Sparrows Point was a relatively small asset of the world's largest steelmaker and competed against other Mittal-owned plants for work, which was awarded to the most cost-efficient.
Bouchard said one of the most attractive things about Sparrows Point is the work force. His company took great pains to win the support of the union when bidding for the plant.
"We're lucky to get 'em," he said.
Esmark won control of Wheeling-Pitt in a proxy fight last year.
Wheeling-Pitt shareholders are scheduled to vote on the merger with Esmark Nov. 27.
Bouchard said the Sparrows Point transaction will not close before Nov. 30 at the earliest.