Background Image
Previous Page  34 / 162 Next Page
Basic version Information
Show Menu
Previous Page 34 / 162 Next Page
Page Background

Transat lant ic Cable

EuroWire – January 2006

32

Euro ire – March 2011

Steel

Evraz North America seeks to improve its

sales by changing the view from the

executive suite

Will moving its headquarters fromPortland to Chicago enable the

Russian parent of Oregon Steel Mills to boost business in Oregon?

Evraz Inc, NA, the $3 billion North American unit of Russian steel

giant Evraz, thinks so, and in January announced the corporate

move. Manufacturing will remain in Portland, the northwestern

city in which Oregon Steel Mills was established in 1928, adding

jobs if Evraz succeeds in improving sales from its transplanted

home base.

The move was not welcome news in Oregon, which has seen an

exodus of US and Canadian corporate operations as the result of

acquisitions or business changes. Richard Read, of the Oregonian,

noted that with each departure, the state loses“executive salaries,

commercial prestige, local decision-making, and informed

support of community causes.”

But Evraz NA chief executive Mike Rehwinkel told the Portland-

based daily that Oregon could in fact profit from the Russian-

ownedcompany’smovetoacentrallylocatedcitywheremanagers

can seek more business for underused Portland plants. He said:

“It’s about growing jobs in Portland for Evraz, which means we

need to be in Chicago to do that.” (“Parent Company of Oregon

Steel Mills Moving Headquarters to Chicago,” 20

th

January).

While the decision was said to be prompted by time-and-space

considerations – it is easier, the Evraz executive noted, to fly from

Chicago than from Portland to customers in Calgary, Houston,

Dallas, Montreal, and Philadelphia – the move has in fact been in

the cards. It advances the company’s effort to integrate the North

American steel conglomerate created when Moscow-based Evraz

bought Oregon Steel in 2007 and, in 2008, Delaware’s Claymont

Steel and Canada’s Ipsco. With the $2.35 billion Oregon Steel

purchase, the Russian company also acquired Rocky Mountain

Steel Mills, which made Evraz the largest rail supplier in North

America. The recession in the US put a crimp in the company’s

plans but did not curb its ambitions. Evraz NA regained sales in

2010 and aims to exceed its $3 billion in revenues this year. As

Mr Rehwinkel told the Oregonian: “We want to be a $4 billion

company going to $5 billion.”

A major US city offers a host of obvious advantages for a

global company. But it should be noted that Evraz’s opening

of its Chicago headquarters, slated for June, represents less

a windfall for the Windy City than the calculated outcome of

a campaign by Chicago’s mayor Richard Daley. A year ago,

Oregon passed ballot measures 66 and 67, raising taxes on

corporations and high-income earners. Mr Daley said at the

time that he would be recruiting Oregon companies. As noted

by the Oregonian, the state of Illinois backed up the Daley

initiative, laying on $3 million in incentives to sweeten the

deal for Evraz, including tax credits spread over 10 years and a

one-time training grant of $50,000.“Illinois competed against

offers from Colorado and Delaware, where the company

also has mills,” wrote Mr Read. “Evraz is expected to invest

$9.7 million in Chicago over ten years.”

While Illinois legislators recently raised the state’s business

income tax rate, Mr Read noted that it is still lower than

Oregon’s. An educated guess would be that Illinois will be

sure to maintain that differential.

Notes on scrap . . .

To forestall any shortageof steel scrap resulting from increased

demand from China and India, the TSB Metal Recycling

subsidiary of Timken Co (Canton, Ohio) is buying a scrapmetal

business in nearby Akron. With the acquisition of City Scrap

and Salvage, announced 31

st

December, Timken will gain the

scrap dealer’s property, equipment, and relationships with its

own scrap providers. Much of the scrap material generated

by Timken plants around the country will now be processed

at the Akron facility. Timken – a manufacturer of bearings,

alloy steels and related components and assemblies – gets

nearly all of its steel supply from recycled metal. As reported

by Robert Wang of the Canton Repository, the company says

that in 2010 it turned 1.5 million tons of scrap metal into steel

bar and tube. A company source told the newspaper that

City Scrap and Salvage, whose revenue for 2010 was about

$17 million, has supplied scrap steel to Timken for 15 years.

Over the last several months of 2010, almost 23,000 New

Yorkers contacted the Department of Sanitation to arrange

for the pick-up of unwanted refrigerators, air-conditioners

and freezers. In more than 11,000 instances, the appliances

disappeared before sanitation workers arrived to take

them away. Although scavengers are a familiar presence in

New York, the scale of the thefts – of large items that become

city property upon deposit kerbside – suggests to sources

in city government and the recycling industry an organised

enterprise.

As reported in theNewYorkTimes by criminal justice journalist

William K Rashbaum (14

th

December), “the big loser” appears

to be a multinational recycling conglomerate, a subsidiary

of which has a large city contract to recycle the hundreds of

thousands of tons of salvageable material generated each

year by New Yorkers, including such bulk-metal items as

appliances.

The subsidiary, Sims Municipal Recycling of New York LLC,

estimates that the thefts, along with schemes involving

redeemable bottles, are costing the company $2m-$4m a

year. Behind those losses, wrote Mr Rashbaum: “Some in the

industry – by some accounts an $85 billion annual business in

2008 – see the hand of organised crime, although no one can

point to hard evidence.”

Telecom

Android overtakes Symbian as the world’s

best-selling smartphone platform

According to a study released on 31

st

January, in the last quarter

of 2010 the Android mobile operating system from Google Inc,

of the US, overtook Symbian, from Finland’s Nokia Corp, as the

world’s most widely used smartphone operating system.