Nucor

Nucor Corporation is an American producer of steel and related products headquartered in Charlotte, North Carolina. It is the largest steel producer in the United States, and is the largest "mini-mill" steelmaker (i.e. it uses electric arc furnaces to melt scrap steel as opposed to blast furnaces to melt iron). Nucor is North America's largest recycler of any material; it recycled 16.9 million tons of scrap in 2015.[1]

Nucor Corporation
Public
Traded asNYSE: NUE
S&P 500 Index component
ISINUS6703461052 
IndustrySteel
Founded1940 (1940)
HeadquartersCharlotte, North Carolina, United States
Key people
Leon J. Topalian
(Executive Chairman, President, & CEO)[1]
ProductsSteel
Rebar
Revenue US$20.252 billion (2017)[2]
US$1.882 billion (2017)[2]
US$1.319 billion (2017)[2]
Total assets US$15.841 billion (2017)[2]
Total equity US$8.739 billion (2017)[2]
Number of employees
~25,100 (2017)[2]
Websitewww.nucor.com

Current operations

In 2016, the company produced and sold approximately 22 million tons of steel. Nucor operates 23 scrap-based steel production mills.[1]

Nucor produces steel bars (carbon and alloy steel), beams, sheet / flat rolled steel, plate, steel joists, joist girders, steel deck, fabricated concrete reinforcing steel, cold finished steel, steel fasteners, metal building systems, light gauge steel framing, steel grating, expanded metal, and wire mesh. In addition, through its David J. Joseph Company subsidiary, Nucor also brokers ferrous and nonferrous metals, pig iron and HRI/DRI; supplies ferro-alloys; and processes ferrous and nonferrous scrap.

Nucor's divisions

Nucor operates many subsidiaries that operate independently, including:

  • Nucor Steel operations are located in Alabama, Arkansas, Illinois, Indiana, Kentucky, Mississippi, Nebraska, North Carolina, Ohio, South Carolina, Tennessee, Texas, Utah, and Washington. Nucor's steelmaking operations are based on the mini-mill concept, using electric arc furnaces and continuous casting technologies to recycle steel. The Nucor Steel plant in Louisiana and Nu-Iron in Trinidad, produce direct reduced iron, which is used in electric arc furnaces to supplement iron units in Nucor’s steel recycling operations. Duferdofin is a joint venture between Nucor and Duferco in Italy producing merchant bar.
  • Nucor Cold Finish facilities use hot rolled steel bar to produce cold drawn bar using a process known as drawing (manufacturing). These divisions are located in Canada (Laurel), Georgia, Missouri, Nebraska, Ohio, South Carolina, Utah and Wisconsin.
  • Steel joist and engineered building divisions, include Vulcraft (AL, IN, NE, NY, SC, TX, UT, Ontario, Alberta), Nucor Building Systems (IN, SC, TX, UT), American Buildings Company (AL, IL, CA, VA), CBC Steel Buildings (CA), and Kirby Building Systems (TN).
  • Nucor Fastener, based in Indiana, produces carbon and alloy steel standard and special screws, bolts, and nuts.
  • Harris Rebar is a leading fabricator, installer and distributor of concrete reinforcing steel and related products. Harris Supply Solutions is a distributor of steel and concrete products including rebar, Black Rebar, Epoxy Coated Rebar, Fabricated Rebar and Steel Remesh.
  • Skyline Steel is a steel foundation supplier serving the U.S., Canada, Mexico, the Caribbean, Central America, and Colombia markets.
  • The David J. Joseph Company is a scrap metal brokerage firm, ferrous and nonferrous metal recycling and transportation provider. DJJ created the U-Pull-&-Pay chain of self-service auto parts stores
  • Nucor Sales has offices in the United States, Colombia, Mexico, Switzerland, and the United Arab Emirates.
  • Nucor Grating is a manufacturer of bar grating products.

History

Nucor's history consists of distinct eras: the Reo Motor Car era, the Nuclear Corporation of America era, the Iverson years (1967–98), the DiMicco era (2000-2012), and the Ferriola era (2013–present).[3][4]

The Reo Motor Car era

Nucor's origins are with auto manufacturer Ransom E. Olds, who founded Olds Motor Vehicle Company in 1897 (later, as Oldsmobile, to become a part of General Motors Corporation). In 1905, Olds left Oldsmobile and established a new company, REO Motor Car Company, in Lansing, Michigan. Though Olds' products, including the luxurious REO Flying Cloud car and REO Speed Wagon truck, were popular, they were not profitable, and the company filed for bankruptcy protection in 1938.[5]

After the bankruptcy reorganization, REO exited the car business to concentrate on trucks but continued to suffer losses. In December 1954, REO sold its entire manufacturing operations to Bohn Aluminum and Brass Corporation.[5]

The Nuclear Corporation era

The company initiated liquidation proceedings after the sale of its operations, but a group of dissident activist shareholders, noticing the existence of a usable tax loss, successfully challenged the liquidation in a proxy fight in September 1955, and forced REO to take over a tiny nuclear services company called Nuclear Consultants, Inc. in a reverse takeover. The company was renamed "Nuclear Corporation of America Inc.", and relocated to offices in the Empire State Building in New York City. Nuclear's attempt to recast itself as a nuclear industry services company was unsuccessful, and it followed the example of other companies in the 1950s and 60s and attempted to become a conglomerate, moving its headquarters to Phoenix, Arizona. It made several acquisitions, including Vulcraft Corporation, a steel joist manufacturer located in Florence, South Carolina. Vulcraft had been founded by Sanborn Chase (no relation to Chase & Sanborn Coffee), who died at an early age, leaving the company to his widow. Nuclear purchased Vulcraft from Chase's widow in 1962 and hired F. Kenneth Iverson as general manager. In March 1965, the company filed for bankruptcy. The Board of Directors fired Nuclear's President (and had to return his business jet to him), but could not find a replacement. Eventually Samuel Siegel, an accountant with Nuclear and friend of Iverson, who had been looking to leave the company, informed the Board that he would remain with the company under two conditions: Iverson would become President and he (Siegel) would become CFO, conditions the Board accepted.[6]

The Nucor (Iverson) era

Iverson and Siegel reorganized Nucor around its only profitable business, the steel fabricator Vulcraft. All other businesses were either sold or liquidated. In 1966, the company moved its headquarters to Charlotte, North Carolina to be closer to its main Vulcraft plant.[6]

In 1968, unable to get favorable steel prices from American manufacturers and unhappy with the imported steel available at the time, Iverson, a metallurgist by training, decided to extend Nucor vertically into steelmaking by building its first steel bar mill in Darlington, South Carolina. The company chose to purchase an electric arc furnace, which was far cheaper than the traditional steel blast furnace, with a $6 million loan secured by all of the company's assets. Production delays and staffing problems caused the stock to drop to pennies but earnings soared in 1971 and 1972.[6]

In 1972, the company, recognizing that it was misnamed, adopted its current name. Since that time, Nucor has expanded into other steel products, gained some control of its raw material supply, became a leader in recycling technology, and expanded its market presence. Decrease in cost of production by EAFs and market demand for low price raw material especially rebars, attracted Nucor not only to produce steel for itself but also selling it to companies in vicinity that otherwise were importing steel.

In 1988, Nucor became the first minimill to manufacture wide flange beams with a depth of 40". The company opened its building products division that same year.

In 1989, Nucor opened a facility in Crawfordsville, Indiana, which was the first mini mill to produce flat rolled steel using thin-slab technology.[7][8]

In March 2000, a joint venture, owned 47.5% by Nucor, 47.5% by BlueScope, and 5% by IHI Corporation was formed to license Castrip technology. This technology allows for continuous casting of sheet steel directly from molten steel without the need for heavy, expensive, and energy-consuming rollers. As a result, mills built with this technology are significantly cheaper and take up significantly less space than other mills.

DiMicco era

In September 2000, Dan DiMicco, formerly the general manager of the company's highly profitable Nucor-Yamato Steel joint venture, was appointed CEO.[9]

In the years that followed, the company made several acquisitions.

In 2001, the company acquired Auburn Steel, its first acquisition in 36 years.[10] In 2002, Nucor bought Birmingham Steel, including the Mississippi Steel plant and Birmingham, Alabama, operations.[11][12]

In 2004, Nucor acquired Corus Tuscaloosa.[13] and in 2005, Nucor purchased Fort Howard Steel[14] and Marion Steel.[15]

In 2006, Nucor acquired Connecticut Steel,[16] Verco Decking,[17] and Harris Steel.[18] The $1.07 billion acquisition of Harris Steel expanded Nucor into production of fabricated rebar, a strong market due to increased spending on infrastructure.

In 2007, the company's Nucor Building Systems division acquired Magnatrax, which bolstered its share of the pre-engineered metal building systems market.[19]

In March 2008, in order to take more control of its raw material supply and prices, Nucor purchased the David J. Joseph Company, one of the largest scrap brokers and recycling companies in the United States.[20]

In 2012, Nucor purchased Skyline Steel.[21]

Ferriola era

Effective January 1, 2013, John J. Ferriola was named as Chief Executive Officer of Nucor and Daniel R. DiMicco was named Executive Chairman.[22] DiMicco retired effective January 1, 2014.[9]

In 2014, the company purchased Gallatin Steel Company.[23]

In 2015, the company acquired additional cold finish bar facilities in Ohio and Georgia.[24]

In 2016, Nucor announced the acquisition of a steel plate mill in Longview, Texas,[25] and structural tube mills in Mississippi, Alabama, and Illinois.[26][27] The acquisition of these facilities expanded Nucor's capabilities in the plate market and added structural tube to the company's product mix.

In April 2017, the company announced an $85 million upgrade of the rolling mill at its Marion, Ohio rebar and signpost operation.[28]

In August 2017, the company acquired St. Louis Cold Drawn, Inc.[29]

On September 6, 2019 Nucor announced that John Ferriola would retire at the end of the year to be replaced by Leon J. Topalian.[30]

Controversies

Environmental record

In 2000, Nucor paid $98 million to settle with the U.S. Justice Department and the United States Environmental Protection Agency to resolve allegations that it had not adequately controlled the emission of toxic chemicals into the air, water, and soil of Alabama, Arkansas, Indiana, Nebraska, South Carolina, Texas, and Utah. The settlement was "the largest and most comprehensive environmental settlement ever with a steel manufacturer."[31][32]

In 2012, as part of a settlement with the United States Environmental Protection Agency, the company agreed to reduce air pollution at its plant in Marion, Ohio.[33]

In 2016, the company unsuccessfully filed a lawsuit to block the Environmental Protection Agency from adopting a plan to control visible pollution in Arkansas.[34]

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See also

References
  1. "EX-13". www.sec.gov.
  2. "Nucor Corporation 2017 Annual Report (Form 10-K)". sec.gov. U.S. Securities and Exchange Commission. January 2018.
  3. Preston, Richard (1992). American Steel. Quill. ISBN 0-380-71822-7. Construction and startup story of Nucor's first big mill, discusses the history of Nucor.
  4. "History of Nucor". Steelonthenet.com.
  5. "REO Motor Company Records". Michigan State University Archives and Historical Collections.
  6. "Nucor Corporation". Company-Histories.com.
  7. HICKS, JONATHAN P. (December 2, 1989). "Thomas Cousins set to retire". The New York Times.
  8. Franklin, Stephen (April 28, 1991). "High-tech Steel Mill Doing More With Less". Chicago Tribune.
  9. "Daniel R. DiMicco To Retire As Executive Chairman Of Nucor; John J. Ferriola Named Chairman Effective January 1, 2014" (Press release). PRNewswire. November 5, 2013.
  10. "NUCOR BUYS STEEL-BAR MILL ASSETS FOR $115 MILLION". Bloomberg News. The New York Times. March 20, 2001.
  11. "Birmingham Steel selling to Nucor for $615M". American City Business Journals. May 30, 2002.
  12. "NUCOR IN $615 MILLION DEAL FOR BIRMINGHAM STEEL". Associated Press. The New York Times. May 22, 2002.
  13. "Nucor buys Corus Tuscaloosa". United Press International. June 8, 2004.
  14. "Nucor to buy Wisconsin plant". American City Business Journals. January 10, 2005.
  15. "NUCOR TO BUY MARION STEEL FOR $113 MILLION". The New York Times. April 19, 2005.
  16. "Nucor unit buys Connecticut mill". American City Business Journals. May 1, 2006.
  17. "Nucor to buy Phoenix company for $180M". American City Business Journals. September 12, 2006.
  18. "Nucor to buy Harris Steel in $1 billion deal". Reuters. January 21, 2007.
  19. "Nucor to buy Magnatrax for $280M". American City Business Journals. June 25, 2007.
  20. "Nucor Acquires The David J. Joseph Company" (Press release). Thomas Register. March 3, 2008.
  21. "Nucor Acquires Skyline Steel LLC" (Press release). PRNewswire. June 21, 2012.
  22. "John J. Ferriola To Be Named Nucor CEO Effective January 1, 2013, Daniel R. DiMicco Continues As Executive Chairman". November 16, 2012.
  23. "Nucor Completes Acquisition Of Gallatin Steel Company" (Press release). PRNewswire. October 8, 2014.
  24. "Nucor to Acquire Cold Finish Bar Assets in Ohio and Georgia" (Press release). PR Newswire. November 9, 2015.
  25. "Nucor to Acquire Plate Mill in Texas" (Press release). PR Newswire. July 20, 2016.
  26. "Nucor to Acquire Independence Tube Corporation" (Press release). PR Newswire. September 19, 2016.
  27. "Nucor to Acquire Southland Tube" (Press release). PR Newswire. December 6, 2016.
  28. "Nucor to invest $85 million in Marion upgrade". USA Today. April 3, 2017.
  29. "Nucor to Acquire Cold Finish Facilities in Missouri and Mexico" (Press release). PR Newswire. August 10, 2017.
  30. Tita, Bob. "Nucor to Replace CEO at Year-End". WSJ. Retrieved 2019-09-17.
  31. "U.S. REACHES ENVIRONMENTAL SETTLEMENT WITH STEEL MANUFACTURER NUCOR". Environmental Protection Agency. December 19, 2000.
  32. "Nucor agrees to pay $98 million for pollution control, penalties". Associated Press. Deseret News. December 21, 2000.
  33. "Nucor Steel Agrees to Improvements That Will Reduce Air Pollution Emissions in Marion" (Press release). United States Environmental Protection Agency. April 6, 2012.
  34. Bailey, David (April 16, 2016). "Federal judge dismisses pollution suit by Nucor Steel Arkansas". Reuters.
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