Gulf States Steel to Sell Off Individual Units of its Alabama Integrated Steel Mill

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Researched by Industrialinfo.com (Industrial Information Resources, Inc.; Houston, Texas). Gulf States Steel, Inc. (Gadsden, AL) hopes to sell its plate and hot strip mill and the continuous slab caster to a group of former bondholders who want to salvage part of the huge integrated mill that ceased operations in August 2000. Some mill assets, including the Structural Beam Facility, were sold at an auction in May to Alabama Structural Products, Inc. (Birmingham, AL), a division of Williams Enterprises (Falls Church, VA) is expected to start up in four to six weeks, hiring about 15 former Gulf States employees. The Blast Furnaces were purchased at auction by Williams Enterprises, which will, in turn, either resell them intact or dismantle them and sell the parts. The Coke Plant is still held by the estate under security for a lien held by Ableco Finance LLC (NYC), an affiliate of Cerberus Capital Management LP (NYC) and Gabriel Capital Group (NYC).

Gulf States, one of only two integrated steel mills in the southeastern U.S., has been especially hard-hit by the dumping of foreign government-subsidized steel, a good part of which has come into Gulf ports and has stayed in that area, dropping steel prices by $100 a ton. According to a Metal Center News Report of June 8, 2001, a union spokesman estimates that some 23,000 steelworkers have lost their jobs since 1998, and 18 companies have been forced into bankruptcy, ten of them since the end of 2000.