WHEELING, W.Va., June 11 /PRNewswire-FirstCall/ -- Esmark Incorporated
(Nasdaq: ESMK) (the "Company"), announced today that its subsidiary
Wheeling-Pittsburgh Steel Corporation has filed a charge under the National
Labor Relations Act ("NLRA") against the United Steel, Paper and Forestry,
Rubber, Manufacturing, Energy, Allied Industrial and Services Workers
International Union (the "USW") alleging multiple violations of federal
labor law in connection with the USW's repeated claims that they can, and
their attempts to, block the proposed acquisition of the Company by Essar
Steel Holdings Limited ("Essar").
The charge, filed with the National Labor Relations Board, details the
alleged violations. The charge identifies specific public and private
statements made on behalf of the USW by high ranking USW officials stating
that: (1) the USW will not deal with Essar or enter into an agreement with
Essar; (2) the USW has the right to veto any proposed transaction between
the Company and Essar under the successorship provision of its collective
bargaining agreement; and (3) that the Company must cease any proposed
transaction with Essar because the USW supports the purchase of the Company
by OAO Severstal, a Russian steelmaker. The Company believes that these and
other actions violate the NLRA which governs issues between unions and
employers.
The NLRA charge comes after Essar stated in a letter to the USW that it
was prepared to recognize the USW as the employees' bargaining
representative and assume the collective bargaining agreement the USW has
in place as well as negotiate a new collective bargaining agreement on an
expedited basis if the USW so desired.
Esmark President Craig Bouchard stated: "The collective bargaining
agreement with the USW has provisions designed to protect employees by
requiring a purchaser to recognize the USW and assume their labor agreement
under certain circumstances. We have always supported that protection for
our employees. The USW seeks to turn what was intended as a shield of
employee protection into a sword to veto business transactions that lie
within the proper province of the board of directors and shareholders of
the Company. The USW's unlawful conduct is particularly troubling given
Essar's commitment to protect employees by assuming the existing contract,
and their commitment to invest over $500 million dollars in the Ohio
Valley.
The Company does not believe that the successorship provisions of the
collective bargaining agreement apply to the proposed Essar transaction,
and specifically the provisions do not apply to Essar's proposed purchase
of shares through a tender offer. The USW's actions constitute labor law
violations that stand in the way of maximizing shareholder value. The
Company looks forward to a prompt resolution of this matter."
Forward-Looking Statements Cautionary Language
This press release contains forward-looking statements within the
meaning of Section 21E of the Securities Exchange Act of 1934, as amended,
including, but not limited to statements related to the USW's alleged
violations of federal law, Wheeling-Pittsburgh's collective bargaining
agreement with the USW, the applicability of the USW's successorship clause
as well as the proposed merger transaction with the Company and an
affiliate of Essar Steel Holdings Limited. These forward-looking statements
are based on current expectations and assumptions that are subject to risks
and uncertainties that could cause actual results to differ materially.
These risks and uncertainties, include, but are not limited to, (i)
uncertainties regarding the outcome of the charge filed by the Company with
the NLRA as well as the USW's defense of such charge; (ii) the risk of a
prolonged labor dispute with the USW or effects on the Company's upcoming
negotiation of new collective bargaining agreement; (iii) uncertainties
regarding the effects on the proposed merger between the Company and an
affiliate of Essar Steel Holdings Limited, (iv) uncertainties regarding the
applicability of the USW's successorship clause, and (v) certain other
risks identified in section "Item 1A - Risk Factors" of the Company's
Annual Report on Form 10-K for the year ended December 31, 2007, and other
reports and filings with the SEC, which identify important risk factors
that could cause actual results to differ from those contained in the
forward-looking statements. In addition, any forward- looking statements
represent the Company's views only as of today and should not be relied
upon as representing the Company's views as of any subsequent date. While
the Company may elect to update forward-looking statements from time to
time, the company specifically disclaims any obligation to do so.
About Esmark Incorporated
Esmark Incorporated is a vertically integrated steel producer and
distributor, combining steel production capabilities through both blast
furnace and electric arc furnace technologies with the just-in-time
delivery of value-added steel products to a broad customer base
concentrated in the Ohio Valley and Midwest regions. Currently
headquartered in Wheeling, WV, the Company is a producer of carbon
flat-rolled products for the construction, container, appliance,
converter/processor, steel service center, automotive and other markets.
The company's products include various sheet products such as hot rolled,
cold rolled, hot dipped galvanized, electro-galvanized, black plate and
electrolytic tinplate. More information about Esmark can be found at
http://www.esmark.com.
Important Information
This document is for informational purposes only and is not an offer to
buy or the solicitation of an offer to sell any securities. In the event
Essar and the Company enter into a definitive merger agreement and
following the commencement of the offer contemplated thereby, the Company
will file a solicitation/recommendation statement with respect to the
offer. Once filed, Company stockholders should read these materials
carefully prior to making any decisions with respect to the offer because
they will contain important information, including the terms and conditions
to the offer.
SOURCE Esmark Incorporated
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Related links:
http://www.esmark.com
http://www.prnewswire.com/comp/967451.html /
CONTACT:
Media or Investor Relations, Dennis Halpin of
Esmark Incorporated, +1-304-234-2421, mobile, +1-304-650-6474,
dhalpin@esmark.com; or Media, Bill Keegan of Edelman for Esmark
Incorporated, +1-312-927-8424, bill.keegan@edelman.com
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