| A year ago, the only steel assets Tom
White Jr. owned were a Chrysler Cherokee and a Mercedes-Benz. Today thanks to
his enormous effort with United Steelworkers President Leo Gerard, the New York
financier is emerging as one of the most important steel executives in
decades. White made a fortune investing in bankrupt companies such as Texaco and Fruit of the Loom, but didn't buy his first steel property until last April, when he bought the mills of bankrupt ATM Corp. no longer in use, for $262 million. At the time the industry was in retreat. Destroyed by extremely cheap imports, nearly half the nation's mills had gone bankrupt, including three of the top five. When assessing White's chances, those in the industry were not optimistic. Yet within a month, White and his partners were rehiring the old workers of what had been the No. 4 steel producer in the U. S. , the International Steel Group. Now, the 1SG chairman is close to finalizing his biggest deal yet—a $1.5 billion bid for the assets of Bethlehem Steel Corporation, which has slowly been descending into bankruptcy since October, 2001. How has White been able to do this? Partly, it is to do with his excellent business understanding. White, 65, perfected his restructuring skills through 24 years at investment bank Rothschild Inc., and negotiated to buy the ATM mills just before President Bush set restrictions that removed foreign suppliers. White brings an outsider's approach to management. Today, ISG has just 22 executives-ATM had more layers than that. More than just salary savings, the cost cuts have shifted more responsibility to the shop floor, which, in turn, has increased productivity. White says that mill workers suggested asking for new pieces of steel ten minutes before a production run was about to end, rather than waiting until it had ended, as was normal. This clever move adds thirty minutes of extra output a day. The bottom line even with a well-paid union workforce, ISG has lifted productivity levels close to the levels of nonunion Nucor Corporation. Not had for such a new businessman. |