Subscribers to AMM have read for years of mergers and
acquisitions in metals, efforts to consolidate the steel
industry and the motives of industry magnates like Lakshmi
Mittal, Alexei Mordashov, Wilbur Ross and others.
As numerous, as complex and as detailed as many of those
stories are-and surely will be in the future-AMM never had a
reporter sitting in a closed-door meeting with the principals
when a deal was on the table.
Craig Bouchard was there. As president of the former Esmark
Inc., a Chicago-based company that started in steel with
service center holdings but grew steadily in influence,
strength and headline-grabbing activity, he lived through the
twists and turns of one of the most interesting and volatile
battles the steel industry has seen.
Bouchard, together with Old Dominion University professor
and economist James V. Koch, delivers a firsthand account of
the roller-coaster ride that Craig and his brother, James
Bouchard, took as they led Esmark from a service center
consolidator to a steel industry player with the acquisition of
Wheeling-Pittsburgh Steel Corp. and the subsequent sale of
Esmark to Russian steel giant OAO Severstal.
In their recently published book, America for Sale How the
Foreign Pack Circled and Devoured Esmark, Craig Bouchard and
Koch recount the beginnings of Esmark, its rise and decision to
go after the venerable Wheeling-Pittsburgh Steel and the
subsequent bidding war for Esmark between Severstal and
India-based Essar Steel, a battle which ultimately more than
doubled Esmark's share price.
The book's cover illustrates some of the story. It pictures
an American eagle clutching a steel beam but surrounded by
tigers and bears, essentially representing India's Essar and
The book, published by Praeger, opens with a lot of economic
basics that help to describe how Esmark rose in stature in
steel, and includes the beliefs of Bouchard and Koch about how
and why foreign investors like Severstal, fellow Russian
steelmaker Evraz Group SA, Essar and Brazilian steelmaker Cia.
Siderúrgica Nacional (CSN), among many others, have set
their sights on the U.S. steel industry and how they have been
able to gain control of more than 50 percent of American
Bouchard believes that another round of "America for sale"
is coming in 2010 as the value of the dollar falls, leading
more foreign companies to look to the United States to invest.
The book describes in detail the dangers and risks associated
with foreign ownership of U.S. steel assets, but at the same
time dispels many economic myths about the manner in which
deals are constructed and executed.
Much of the economic discussion in the book is elementary,
although at times it becomes very detailed. The details,
however, are critical to understanding Esmark's position in the
U.S. steel industry and provide some of the answers observers
were seeking as the story of Esmark and its sale to Severstal
It was commonplace, for example, to hear steel industry
veterans ask, "How are they (the Bouchards) doing this?" or
"How do they think they can pull this off?" America for Sale
tells how it was done, complete with all manner of emotion and
activity from quiet confidence to brashness, hard negotiation
to hand-wringing, threats to compliments and back-room dealing
There is something in the book for students interested in
economic lessons and for steel veterans wanting the inside
story to sports fans wondering how Stanley Cup playoff hero
Evgeni Malkin ended up playing with the Pittsburgh
Among the more interesting sections of the book are stories
relating how the former management of Wheeling-Pittsburgh Steel
initially aligned itself with CSN against the Bouchards when
Esmark first broached a takeover of the steel operations, and
the dealings of the United Steelworkers union and Ron Bloom,
one of its main operatives and now a key figure in the Obama
Another is the alignment of the USW with Severstal even as
Essar offered a higher share price for Esmark. Bouchard and
Koch explore and share the reasons why they believe such an
arrangement was made.
Ultimately, the authors offer a number of predictions for
the future and a list of winners and losers in the battle for
control of Esmark. Predictions include another wave of "America
for sale" next year.
Winners include Esmark shareholders, who got more than they
expected for their shares. Losers include Severstal and the USW
(for now at least), given that Severstal is losing money and
has had to close plants and that the USW has seen massive
worker layoffs and a reduction in its all-important collection
of union dues.
Readers also will be winners. America for Sale How the
Foreign Pack Circled and Devoured Esmark answers many questions
and poses more. Those who read it likely will come away with a
better understanding of the moods and motivations of major
business leaders as they construct merger deals.
Such information could prove invaluable if Bouchard's and
Koch's predictions of another round of "America for sale" are