Reports: Severstal looks to sell steel plants in Dearborn and Mississippi

Severstal, a Russian steelmaker that employs about 1,800 in Dearborn, has put its North American operations up for sale, according to several news reports. / Associated Press

Severstal, a Russian steelmaker that employs about 1,800 in Dearborn, has put its North American operations up for sale, according to several media reports.
The steelmaker operates mills in Dearborn and Columbus, Miss., that could be worth $1.5 billion or more, according to the Wall Street Journal. Severstal has at least two interested buyers, including U.S. Steel and Brazil’s Companhia Siderurgica Nacional, according to Bloomberg News.
Katya Pruett, a spokeswoman for Severstal, declined to comment.
American Metal Market, a trade publication, reported that a May 8 deadline for bids has been extended, and that Severstal will choose two or three finalists later this month, and a winning bid within two months.
A spokeswoman for U.S. Steel declined to comment.
Severstal has invested $1.4 billion in Dearborn since purchasing the former Rouge Steel operations for $285 million in 2003. The plant, originally built a century ago as part of Henry Ford’s Rouge Complex, is across from the automaker’s Dearborn truck plant.
The company employs about 2,500 in the U.S.
■ Related: Severstal steel plant gets approval for revised emissions permit
The Mississippi operation is a mini-mill that makes steel out of scrap metal, but industry experts say it is the more valuable asset.
The steel industry continues to grapple with overcapacity: too many mills for the current and near-future demand. Competition in the U.S. from low-cost imported steel and the trend of automakers’ push for lighter-weight alternatives such as aluminum are always pressuring steelmakers.
China’s rapid growth, which has driven most of the industry’s demand in recent years, is beginning to slow.
Ford’s neighboring truck assembly plant, for example, is retooling for the new 2015 F-150 truck, which will feature an aluminum body.
Severstal is controlled by billionaire Alexey Mordashov, one of Russia’s wealthiest men. To date, neither Mordashov nor Severstal has been targeted by U.S. sanctions that the Obama administration has used in response to Russia’s occupation of Crimea and related military actions in eastern Ukraine.
On Monday, Severstal won approval from the Michigan Department of Environmental Quality for revisions to a permit that will allow the Dearborn steel plant to release higher levels of pollutants into the air.
Plant officials wanted the state to allow higher pollution levels, while grandfathering the permit so it was considered under 2006 rules rather than stricter standards implemented in recent years, the Free Press reported separately Tuesday.
In addition to the reset emissions standards, Severstal agreed to monitoring and reporting requirements that include additional smokestack testing.
Severstal said the purpose of the air permit was to make corrections to a 2007 permit.
“Severstal welcomes the air permit issued by the Michigan Department of Environmental Quality to make corrections to a 2007 permit that was issued for the reconstruction of a blast furnace that reduced air emission then,” Severstal said in a statement. “There will not be any increase in emissions from the plant as a result of this new permit correction.”
Contact Brent Snavely: 313-222-6512 or bsnavely@freepress.com. Follow him on Twitter @BrentSnavely.