Bayh’s plea for a takeover delay is because International Steel Group (ISG), Bethlehem and the United Steel Workers of America (USWA) had planned to use early retirement and entrance into the pension plan to achieve the job cuts ISG has been seeking, according to a news story in the Chesterton (Indiana) Tribune.
This week, ISG offered $1.5 billion to buy the bankrupt Bethlehem Steel’s assets. (See ISG Bethlehem Steel Deal Expected ).
However the Pension Benefit Guaranty Corporation announced December 16 that it intended to terminate the Bethlehem plan. (See PBGC Puts a Wrench in Bethlehem, International Steel Merger). Under PBGC trusteeship, a worker with less than 30 years of service will not be able to enter the plan until age 62. That would most directly affect as many as 1,400 hourly workers eligible to enter the Bethlehem plan before the PBGC involvement, the newspaper story said.
“PBGC’s takeover could interfere with the United Steelworkers, Bethlehem, National Steel, and other companies’ efforts to consider retirement incentives to ease the impact of potential job cuts,” Bayh said in a statement. “Too much is at stake for Northwest Indiana’s steel industry and its workers for this decision to be taken lightly.”
As a result, ISG is anticipating using its own resources to offer hourly workers incentives to take early retirement – a move that significantly reduced the total value of ISG’s bid, the newspaper said. ISG has not said how much the bid would be cut.
The PBGC’s takeover of the Bethlehem plan would be the largest ever in its 28-year history.