OHIO STEEL COUNCIL RAISES CONCERN OVER PROPOSED RAILROAD MERGER, CITES LOSS OF COMPETITION

COLUMBUS, Ohio (February 17, 1997) –  A group representing Ohio's steel industry is opposing the proposed railroad merger of Conrail Inc. and CSX Corp., citing the loss of rail competition could adversely affect Buckeye State steel plants.

The Ohio Steel Council, a group of steel, labor, education and government officials, believes the merger could lead to reductions in rail service or higher rail rates for many steelmakers.

The Steel Council also expressed concern over Norfolk Southern Corp.'s competing attempt to merge with Conrail.

"Until further information is provided by the railroads regarding competitive access, rates, safety and other issues, the Ohio Steel Council is opposed to a Conrail/CSX merger and is wary of a Conrail/Norfolk Southern merger," said Harold V. Kelly, co-chairman of the Council and executive vice president at Republic Engineered Steels, Inc. in Massillon.

"Steelmakers have worked hard to improve their competitiveness. These mergers could seriously undermine those efforts and jeopardize the job security of our employees."

The Steel Council outlined its concerns in a letter to Ohio Governor George V. Voinovich. Conrail has committed to merge with CSX, but Norfolk Southern has made a subsequent bid to buy Conrail shares.

The Council's nine member steel companies use rail for receipt of raw materials or shipment of finished products, or both.

"A merger would remove the present competition that exists at plants served by multiple railroads, eliminating access to competitive rates and service," said Edward R. Caine, president and chief executive officer of WCI Steel, Inc. in Warren. WCI is served by CSX and Conrail.

Potential downsizing by the railroads also is a concern. CSX, for example, abandoned a rail line into CSC Ltd.'s steel plant in Warren three years ago, prompting the company to rely on an economic development agency to buy the line and restore service.

The Ohio Steel Council (formerly known as the Ohio Steel Commission) is a public-private partnership to strengthen ties among the steel industry, the state of Ohio and its citizens. The Council's member organizations are AK Steel Corp., Armco Inc., CSC Ltd., LTV Steel Co., Republic Engineered Steels, Inc., The Timken Company, USS/KOBE Steel Company, WCI Steel, Inc., Wheeling-Pittsburgh Steel Corp., the United Steelworkers of America, the Ohio Legislature, the Ohio Department of Development, The Ohio State University, and Youngstown State University. Lukens Inc. is an associate member.