Birmingham Steel Corporation

Birmingham Steel is a now-defunct steel producer in the United States that specialized in reinforcement bar (rebar) and specialty steel products. The company was founded in 1983 by a group of private investors who purchased mini-mills in Illinois and the facilities that had been operated by Birmingham Bolt company. The investors purchased Jackson, Mississippi-based Mississippi Steel Division of Magna Corporation and with that firmly established industrial capacity, the company went public on the New York Stock Exchange in 1985.

The company employed 1,554 workers at its peak and achieved annual sales of $702 million.

History of the Company

When in operation, Birmingham Steel was the second largest operator of steel mini-mills in the United States. It possessed 13 steel production facilities and operated four steel mini-mills, two rod and wire plants and two steel distribution centers.

Birmingham Steel began with its incorporation in 1983 by the venture capital group AEA Investors, Inc. This group took a risk in this period, as throughout the 1970s and early 1980s U.S. steel manufacturers were under intense pressure from foreign companies, rising costs and the swift outdating of U.S. steel manufacture technology. A number of U.S. steel mills eliminated jobs during this period, and many more closed.

It was the business theory of the group of investors that smaller U.S. mills were undervalued because of these market trends, and the investors decided to purchase the undervalued resources in an attempt to compete with the emerging foreign markets. They expected to do so by renovating the facilities and bringing them up to date in terms of operations and technology.

The facilities chosen by the investment group were those that would come to be called mini-mills. Mini-mills, also known as market mills, were a marketing strategy developed to compete with the massive legacy companies of the United States steel industry. Mini-mills were smaller than large-scale mills, more efficient, and more specialized. Because of this they were able to more effectively adapt to market demands.

The investment strategy proved effective, and the newly founded company thrived. By 1986, Birmingham Steel found itself in a profitable position and began to undertake renovation projects and also began to pay down debt. In the brief time after the company went public on the NYSE, the company's sales had increased 500 percent, reaching $218 million in 1987. Birmingham's annual steel output amounted to 648,000 tons annually.

In 1990, the management of the company regrouped and began to expand existing facilities, but perhaps because of this expenditure, the net sales began to decline in 1991. The situation was not helped by a decline in the markets generally, and particularly in the West Coast and Northeast steel markets. The company increased production at its mini-mills to compensate and also opened additional steel distribution centers on the East and West Coast.

Bankruptcy

The company's growth was not to be continued, however, as by 2000 the U.S. steel market was experiencing profound difficulties, particularly due to the influence of market forces brought on by the easing of government regulation on foreign steel producers.

In June 2002, after losing money for several quarters in a row, Birmingham Steel filed for Chapter 11 bankruptcy protection.

The second largest steel manufacturer in the United States at the time - Nucor - entered into an exclusive, non-binding agreement to purchase Birmingham Steel's assets for $615 million. The deal was finalized in December 2002.

Asbestos Risks

Because of its ability to block fire, asbestos was commonly used in numerous factories, mills, power plants and worksites in every state of the United States, including Birmingham Steel Corporation. Although using asbestos was generally considered a way to reduce the risk of injury, it unfortunately often had the opposite effect: asbestos exposure on the job has resulted in serious illness for far too many people.

The disorders linked to exposure to asbestos include asbestosis and cancer; the biggest risk of contracting these conditions occurs when products containing asbestos become friable, releasing strands into the air where they are available to inhale or ingest. The most deadly of the asbestos-caused illnesses is mesothelioma, a type of cancer that involves the cells lining the pleural cavity; it is almost always a death sentence for those who contract it.

To learn more about mesothelioma and the latest in treatment options, please fill out this form to receive a comprehensive and complimentary packet in the mail.

Because numerous studies have demonstrated the link between being exposed to asbestos and conditions like asbestosis, modern-day workers are protected by government regulations that control how asbestos is used. Even as late as the 1970s, however, laborers without respiratory equipment all too often toiled in places filled with airborne asbestos. Spouses were also exposed to asbestos if workplaces didn't provide workplace-only uniforms, because employees inadvertently transported asbestos particles home with them on their skin or in their hair.

Mesothelioma and other asbestos-related illnesses frequently take 20 years or more to manifest, and the symptoms of these disorders can be difficult to distinguish from those of other conditions; therefore, men and women who were employed at Birmingham Steel Corporation at any time in the past, as well as their family members, are advised to chat with their doctors about their history of exposure to asbestos.

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