Wheeling-Pittsburgh Corp. has a new life - new name, some new shareholders.
A day after its shareholders approved a takeover bid from privately-held Esmark Inc., the Wheeling-based steelmaker became part of the Illinois-based steel distributor.
Esmark began trading as a public company on Wednesday on the Nasdaq Stock Market under the symbol ESMK. Its shares traded at $19.01 in mid-morning dealings after opening at $19.28 and trading as low as $17.30 earlier in the session.
The deal culminates more than a year of effort by Craig and Jim Bouchard, the brothers behind Esmark, to add a steelmaker to their distribution business that serves about 2,000 customers in the Midwest. Esmark won control of Wheeling-Pitt in a proxy fight last December.
Wheeling-Pitt shareholders were allowed to choose among standing pat; keeping their original stake and buying new shares at $19 apiece; or selling to Esmark for $20 in cash.
The deal is not expected to be the last for the Bouchards.
They've talked openly about a deal that would add ArcelorMittal NV's Sparrows Point steel mill in Maryland to the growing collection of companies they've amassed over the past four years. Esmark owns a small piece of E2 Acquisition Corp., which has agreed to buy Sparrows Point for $1.35 billion (0.92 billion EUR).
Key to Esmark's takeover bid was the opportunity to straighten out Wheeling-Pitt's finances. The company, which has survived two bankruptcies, lost $56.54 million (38.34 million EUR) as revenue declined 18.6 percent in the third quarter, compared with a profit of $17.35 million in the same period of 2006. It also was mired in approximately $525 million (356 million EUR) in debt, a figure that the Bouchards say will be reduced to $275 million (186.5 million EUR) by the end of the year.
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