Recollections given of first CEO of ESOP at Weirton Steel
WEIRTON – When the first big steel industry shock to hit the area calmed, Robert L. Loughhead took on the task of forming a fully independent Weirton Steel Corp.
National Steel, parent of Weirton Steel, announced in March 1982 that it would no longer make capital improvements at the local plant and would reduce it to a finishing mill with about 1,200 workers. It had about seven times that number when the announcement was made.
Loughhead became the first president of the employee-owned Weirton Steel Corp. in 1984, serving through mid-1987. Loughhead died Sept. 18 in Annapolis, Md. He was 84.
He took the presidency of Weirton Steel after being among a few people chosen by a corporate search firm as possible leaders for the new steel venture.
Loughhead came to Weirton in 1984 after serving six years as president of Copperweld Steel in Warren.
He had to put together the departments and systems that were needed to survive as a stand-alone company, said William Kieffer, who was Weirton Steel vice president, general counsel and secretary.
“He was a very good person, a good steel man. He understood finance and operating costs very well,” Kieffer said. “He was the man who got Weirton Steel off the ground and gave it its original direction.”
Kieffer, who became vice president and general counsel at Bethany College after his Weirton Steel years, said if one thinks about a new business being like a person, its parents have to undertake certain duties at different stages of life.
“Certain behaviors are needed to get it from birth to walking and another kind of leadership is needed about the time kindergarten rolls around. Business goes through similar stages. While it was an operating steel mill, it wasn’t a stand-alone business when he got here,” Kieffer explained. “There was no true accounting or finance department, no computer department, no marketing or sales departments. He was responsible for getting all of that started.”
Loughhead, quoted in news articles of the day, said he saw opportunity in Weirton.
“One of the main attractions to the job was my tremendous admiration of the employees and the community,” he said in an Associated Press article on July 30, 1983, about five months before there was an actual Weirton Steel. The paperwork was not signed until Jan. 11, 1984, turning the mill over to the Employee Stock Ownership Plan. Employees had taken major concessions to buy the plant and retire outstanding debt.
Loughhead stayed on the job until July 1987, choosing to retire as the company approached the need for major refinancing and a long-term capital improvement program to fully modernize the mill. Loughhead said upon his retirement that he didn’t think he would be chief executive through all the long-term programs he saw as necessary for the company’s survival, so he stepped aside at the beginning of the programs.
Chuck Cronin, longtime public relations director for Weirton Steel, recalls Loughhead as a meticulous, smart man.
“He wanted whoever worked for him to be meticulous. He didn’t like for people to scruff their words. He was very, very good in English and he was a flawless speaker. He was very eloquent,” Cronin said. “And, he knew steel. He got along with just about everybody I knew. I admired his brain. He was just so smart.”
Cronin, now public relations director for First Choice Community Federal Credit Union, said Loughhead had a sailboat and would sail as a hobby and to clear his mind.
“That’s how he spent his time when he retired. He loved to sail. That and his grandchildren,” Cronin said.
The two men stayed in touch with letters over the years.
“He had a really scientific mind. The last thing he sent to me was ‘The Wait of the World,’ an article he read about how ditching the leap second would mean decoupling clock time from the earth’s rotation. On the front, he wrote, “Hi, Charlie, here’s an item you might find worthy of putting in your column,” said Cronin, who writes the About Town column for The Weirton Daily Times. “He had read a couple of books about longitude and latitude, which came into his hobby of boating.”
“He knew his stuff and I thought he would be a big success, and I think he was,” Cronin said.
The stand-alone Weirton Steel had been a success story in its early years, with sales of more than $1 billion annually. It continued to be one of the world’s leading producers of tin. The company had enjoyed a dozen profitable quarters under Loughhead. Prior to his retirement, Loughhead had been cautioning that profits and capital expenditures needed to rise heavily in the years ahead to ensure a shot at survival. Some layoffs already were being eyed in the administrative ranks as Loughhead retired.
Loughhead, quoted upon his retirement by the UPI, said, “I think we have proven something, keeping in mind we were always plowing new ground.”
Keiffer, who now practices law with the Weirton firm of Frankovitch, Anetakis, Colantonio and Simon, said Loughhead was a demanding man who wanted to see the mill modernized.
“They were a little hamstrung because the EPA was on them and they ended up having to spend more than they wanted on pollution control updates. National hadn’t been spending on them,” he said. “He wanted to see the place modernized, so that it would be competitive on more than just price decreases that they were able to give because of the wage reductions under ESOP. He wanted to see the mill produce a quality product, with a strong brand identity.”
John Balzano, longtime union official with United Steelworkers Local 2911, which as the Independent Steelworkers Union had signed the deal that formed the ESOP, recalls that the ESOP study committee had looked at several possible chief executives. He recalled Loughhead as “an aggressive, young guy with all the qualities to lead us forward. The committee felt comfortable that he could lead us through, and he gave a great start to us at the time.”
Following Loughhead’s departure, a combination of business conditions, impact from imported steel and consolidation of the domestic steel industry around the turn of the century eventually led Weirton to be even smaller than National said it wanted in 1982. Weirton now has fewer than 1,000 workers.
The last coil of Weirton-made steel was rolled at the end of 2007.