Northwest Pipe closes in on $22M deal

Northwest Pipe Co. of Vancouver, Wash., said it has received a verbal commitment on a $22 million order from Reynolds-Tierdale of Denver to supply pipe for the Prairie Waters Project for the city of Aurora, Colo.

The company will supply approximately 68,000 feet of 60-inch steel pipe valued at approximately $22 million for an engineered and custom-fabricated piping system. The pipe is expected to be manufactured in the company’s Denver division with delivery scheduled to begin in the third quarter of 2008.

The Prairie Waters Project is designed to provide a reliable supply of high quality water to the City of Aurora by drawing water from the South Platte River through collector wells. It will be delivered to nearby natural purification basins where its movement through sand and gravel will take it through a natural cleansing process. The water will then be piped 38 miles south to the Aurora Reservoir where it will be treated at a new water purification facility. It is anticipated to deliver up to 10,000 acre feet of water by 2010 and up to 15,000 acre feet by 2012. The Prairie Waters Project is projected to provide enough additional water to meet the city’s demands into the 2020s.



Olympic Steel Inc., a national steel service center based in Cleveland, said net sales were up 6 percent in the first quarter, to $274.9 million from $259.4 million a year ago.

Net income for the first quarter was $13.2 million, compared with $5.3 million for the year-ago first-quarter. Olympic reported an increase in tonnage sold of 1.2 percent in the quarter, besting Metals Service Center Institute statistics of a 4.8 percent decline in year-over-year steel shipments in the first quarter.

Olympic Steel’s Board of Directors approved a regular quarterly cash dividend of $.04 per share to be paid to shareholders of record as of June 2, and distributed on June 16.



Universal Stainless & Alloy Products Inc. said it will raise base prices on all tool steel products made at its Bridgeville, Pa., and Dunkirk plants by 5 percent to 7 percent, effective Thursday on new orders.

Current material and energy surcharges will remain in effect.

The company said the new price hikes are necessary to offset sharply higher energy and operating supply costs amid continued strong market demand.



Commercial Metals Co., headquartered in Irving, Texas, announced it has completed the acquisition of substantially all the operating assets of Rebar Services and Supply Co. of Fort Worth, Texas. Established in 1982, RSS is a rebar fabricator that services the North Texas area and has approximately 30 employees. The acquired assets will operate under the new name of CMC Rebar as part of CMC’s Americas Fabrication and Distribution segment.

Commercial Metals and subsidiaries manufacture, recycle and market steel and metal products, related materials and services through a network including steel minimills, steel fabrication and processing plants, construction-related product warehouses, a copper tube mill, metal recycling facilities and marketing and distribution offices in the United States and in strategic international markets.



ArcelorMittal said it has signed new long-term contracts with Brazilian mining company Vale to supply iron ore and pellets to its plants in Europe, Africa and the Americas.

Under these long-term contracts, which are the largest ever signed between a steel company and an iron ore supplier, Vale will supply approximately 480 million tons of iron ore and pellets to ArcelorMittal plants over the next 10 years.

Commenting, Davinder Chugh, recently nominated to the company’s group management Board, with responsibility for shared services, said:

“This is an important agreement for ArcelorMittal as it ensures that we have the required levels of iron ore to operate our steel plants fully in line with current global demand. Additionally the company has 45 percent captive iron-ore self-sufficiency, with plans to increase this further to 75 percent.”



Ternium S.A. announced the National Assembly of the Republic of Venezuela passed a resolution declaring that the shares of Ternium’s majority-owned subsidiary Sidor, C.A., together with all of its assets, are of public and social interest. This resolution authorizes the Venezuelan government to take any action it may deem appropriate in connection with any such assets, which may include expropriation.

While continuing to preserve all of its rights under contracts, investment treaties and Venezuelan and international law, Ternium is prepared to continue discussions with the Venezuelan government regarding the adequate and fair terms and conditions upon which all or a significant part of Ternium’s interest in Sidor would be transferred to the government.

Venezuelan President Hugo Chavez threatened to expropriate Venezuela’s largest steel maker unless the soon-to-be-nationalized company revises what he called excessive compensation demands.

Chavez dismissed a request made by Ternium SA, for $4 billion in exchange for its 60 percent stake in the steel maker.

“I’m not going to pay $4 billion for that company,” Chavez said. “If they don’t want to reach an agreement with us, I’ll sign an expropriation decree. I’ll take immediate control.”

Venezuelan Mining Minister Rodolfo Sanz said Venezuela values Ternium’s stake at about 800 million, but plans to pay even less after subtracting the company’s outstanding debts.

Chavez has made nationalizing major industries a centerpiece of his socialist agenda. His government last year seized majority control of the country’s largest telecommunications and electricity companies, and of joint oil ventures previously run by some of the world’s largest oil companies, the Associated Press reported.

In April, in addition to Sidor, he announced plans to nationalize cement companies including Mexico’s Cemex SAB, France’s Lafarge SA and Switzerland’s Holcim Ltd. The government is now negotiating sale terms with the companies, which will be allowed to stay on as minority partners.

Ternium SA is controlled by Argentine-Italian conglomerate Techint Group. Ternium currently owns 60 percent of Sidor, while the Venezuelan government holds 20 percent. The remainder is held by current and former employees.

Sidor — whose formal name is Siderurgica del Orinoco — was privatized in 1998. It turns out about 85 percent of the 5.5 million U.S. tons of steel Venezuela produces annually, according to the Belgium-based International Iron and Steel Institute.



(Steel Talk is compiled from various sources and is edited by Business Editor Paul Giannamore. His e-mail address is pgiannamore@heraldstaronline.com.)