Bar mill CSC in bankruptcy revamp

By Staff -- Purchasing, 2/8/2001

CSC Ltd., the steel bar maker in Warren, Ohio, filed a voluntary petition for bankruptcy protection in mid-January, two weeks after LTV Steel in Cleveland did so. "It is our sincere goal to reorganize and emerge as a stronger company as soon as possible," says Randolph P. Lachowski, CSC president and chief executive officer. In its filing, CSC listed total assets of $216 million and total debts of $259 million.

CSC steel bars are used in forge shops, machine shops, steel service centers and in the auto, aircraft and energy industries. CSC opened for business in 1939 originally as Copperweld Steel. The company changed its name to CSC Ltd. in 1995 when the Reserve Group, of Akron, Ohio, purchased it.

Lachowski says the company needed to file for Chapter 11 in order to continue operating in "market conditions that have dramatically deteriorated due to the competitive pressures of both foreign imports and industry overcapacity."

Many steelmakers carry junk-bond ratings and steel stocks are trading at historic lows, making them among the worst performers in the stock market last year. The Standard & Poor's index of iron and steel companies is down 40.1% for the past 12 months, compared with a drop of 10.1 % for the S & P 500. It doesn't look like steelmakers will catch a break anytime soon either. Although imports have dropped in recent months, they remain at high levels. Steel prices are at a 20-year low and this year doesn't look any better. Huge consumers, such as automotive and appliance makers, have negotiated contracts calling for a 2% to 5% price cut.

"The fact of the matter is that in this climate you cannot make money making steel in this country," James G. Bradley, CEO of Wheeling, W. Va.-based Wheeling-Pittsburgh, said recently. His company filed for Chapter 11 bankruptcy-law protection in November.