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Keith Busse: Is there life after SDI?

Oct 31, 2013 | 08:00 PM | Jo Isenberg-O’Loughlin

Tags  Keith Busse, Steel Dynamics, SDI, Nucor, Jo Isenberg-O'Loughlin


Keith Busse has always been good at numbers. It was numbers and a background in business finance and accounting that paved the way to his first job at Nucor Corp.--as a division controller at one of the Charlotte, N.C.-based steelmaker’s fabricating units--and his 21-year career there. It was a single-digit number--specifically the difference in the thickness between a conventional and “thin” slab--cast on a consistent, quality basis that wrote his name large in the history books of modern steelmaking. And it was his mastery of plain arithmetic alloyed with tons of entrepreneurial spirit that convinced Busse and, in turn, his two partners, Mark D. Millett and Richard “Dick” P. Teets Jr., to leave Nucor and their longtime boss and mentor, F. Kenneth Iverson, and strike out on their own.

Fort Wayne, Ind.-based Steel Dynamics Inc. (SDI), co-founded by Busse, Millett and Teets in 1993, is now a steelmaking powerhouse. In two decades, the company has evolved from a business plan pieced together on weekends at the home of whoever’s wife was away at the time to annual sales of $7.3 billion in 2012 generated by more than 6,700 employees at five steel mills, six steel processing facilities, two iron production plants, six steel fabrication operations and more than 90 recycling locations.

Busse quarterbacked the SDI team for 19 of the company’s 20 years, serving first as chief executive officer, then chief executive and president, and--prior to his official retirement at the end of 2011--chairman and chief executive officer. Millett assumed the title of president and chief executive officer Jan. 1, 2012, with Busse maintaining his ties to the company as chairman of the board of directors and a consultant to SDI.

“I probably spend three or four hours a week involved in company business in one way or another,” Busse told AMM in a recent exclusive interview. “Some weeks it could be eight hours and other weeks it could be zero. I caucus with Mark probably every couple of weeks and we get together to discuss how we are going to accomplish X, Y or Z. He keeps me abreast of what’s going on internally in the company. I’m fairly familiar with what is going on externally.

“But I am retired and I try to stay out of Mark’s hair,” Busse said. “I think I am doing a pretty good job of that. And he is doing a good job running the company. All of us have really gotten along well together as a team. And we still function today as a team, even though I am retired.”

Busse may be retired in theory, but his appointments and travel schedule suggest anything but. “I think when I counted them up this morning I am involved in 14 companies,” he said. “I also sit on the boards of two universities, I’m on the board of one of the only two accredited automobile museums in the country and I also serve on three community boards. And I am very involved in economic development in northeast Indiana. I have stayed very, very busy.”

Although the last thing on his mind as a young man was growing up to be an accountant, a unique combination of numbers savvy and an innate ability to quickly size up how--and even if--things work have served Busse well throughout his entire career. “When I was a young man, I wanted to be a mechanical engineer. I wanted to go to Purdue (University) and I applied,” he said. “Of course, that was back before we had student loans, Pell grants and all these wonderful vehicles to get our children, if they were up to the task, through college.”

Faced with the do-it-yourself-or-don’t-go approach to financing college, Busse changed course. He shelved his aspirations of becoming a mechanical engineer, got a job, worked nights, went to school during the day and earned a two-year degree in accounting. “The idea was I could get a job, then leverage that two-year education into more education and more education,” he said. “Eventually, I went to school at night and got a four-year degree in business finance and then went to school at night and got a master’s degree in business administration.”

Busse’s affinity for numbers and genius for figuring out the way things work were not lost on Iverson, former Nucor chairman and chief executive officer. “Ken used to say, ‘Keith, you’d make a better engineer than a bean counter. You have a knack for things mechanical. You can look at something, tell if it is going to work, how far it is going to go, or why it won’t work.’”

Those same skills are alive, well and being exercised daily in the many and assorted activities Busse is engaged in outside of his duties and ongoing association with SDI. If there is a common theme running through the motley collection of businesses in which he is involved--spanning from firearms (Freedom Firearms LLC), home building (21st Century Homes and Hickory Creek Homes) and a pair of golf courses (Bridgewater and Sycamore) to big-time banking (Tower Bank), hunting reserve (Muy Grande), recycling (Rubber Innovators LLC) and an Internet provider to rural America (Axess America LLC)--it’s the urgent need on the part of each enterprise or entrepreneur to find someone to fix it.

“That is very much a forte of mine. That is what I do best,” Busse said. “I help create new companies or fix broken companies. It is something I think I have the skillset to do.”

One of the most notable fixes to date involved Tower Financial Corp., a Fort Wayne, Ind.-based bank and financial services institution, which “went through its trials and tribulations in the 2006-07 time frame with the mortgage markets collapsing, commercial real estate tanking and things like that,” Busse said. “I was a director and the bank got into--I wouldn’t say severe--but moderate difficulty with inappropriate risk. We took our lumps.”

The distress call went out and Busse answered. “The board thought they needed my guidance and leadership and that of a new operating team so I was made chairman of Tower” in late 2009, he said. Just four years later, he is bullish on the bank’s prospects and its management team. “I think we are one of the best-performing banks in the entire Midwest at this point in time,” Busse said. He evidently is not the only one. Over that same time frame, Tower’s stock price had zoomed to more than $24 per share in late October this year from $4 in December 2009.

About that same time, another SOS landed on Busse’s desk from the son of a former SDI director who had passed away. The family’s automobile dealership business had fallen on hard times, some self-made, including a disastrous detour into auto racing, and some--such as General Motors Co.’s decision to exit Saturn and Pontiac--inflicted externally.

“The company was in bad need of restructuring and bad need of new capital,” Busse said. “The owner asked me for help and I became his partner in the automobile business. We fought our way back to sunshine in the past three or four years and are doing very well now.” So well, in fact, that Busse and his partner have launched another business--SVM (for Special Vehicle Manufacturing)--that has all the earmarks of a winner.

“We have a unique product,” Busse said, referring to a pickup truck-based vehicle, the chassis and frame of which is modified for wheelchair entry via an elevator-type platform into the driver or passenger side of the cab. “We took our product down to Walter Reed Army Hospital not too long ago and the doctors loved it. It fits perfectly into the ‘wounded warrior’ kind of program, serving individuals who are handicapped or disabled in the lower extremities. “It took a little money to get that thing going, but I don’t see us returning to negative figures. The market for that product is actually growing very nicely.”

Busse also is very bullish on Axess America, which was formed by “a gentleman from Kansas and some guys from Fort Wayne” to provide high-speed Internet services to rural America. “High-speed Internet is available in the cities, but people like Verizon (Communications Inc.) and others have largely ignored rural America,” he said. “Collectively, this team had this idea to install a little box on your house or, if you are close enough to a tower, just put in a modem and using fiber optics go from tower to tower without being connected to a satellite. We are putting a lot of our Internet on the Spectrum 2.5 band, which is the right band to be on for information that travels in this manner. And it is going moderately well. I am very excited about it. In time, this could be a very large company. We are in the process of buying or joint venturing with a company in Kansas.”

Commenting on his seemingly boundless appetite for new ideas and the broad range of activities he has become involved in since retiring from SDI, Busse cites the influence of Joseph D. Ruffolo, former president and chief executive officer of North American Van Lines Inc., co-founder of Tower Bank and lead director of SDI, who passed away in late 2011.

“Joe retired at a fairly young age and got involved in boutique banking,” Busse said. “Joe would put financial packages together and lay out a course of action for young entrepreneurs and people who had a great idea but had gotten into trouble from an administrative or governance perspective and helped save jobs. When Joe passed away, everybody said, ‘where are we going to go now? Who are we going to see for these kind of opportunities?’ And for some reason my name kept coming up and coming up,” Busse said. “Maybe I ought to say ‘no’ more often.”

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