Wednesday, November 20, 2013

The Day U.S. Steel said no to steel

32 years ago today yesterday (meant to post this yesterday, but was distracted) the nearly unthinkable happened..  U.S. Steel bought Marathon Oil in a mostly unleveraged deal enabled in large part with money it was not using to reinvest into its existing capital.  A few years later the newly re-conglomerated firm took on the name USX and moved its headquarters to Houston.  The Steel City would be left without Big Steel.


Anonymous The Wiz said...

IIRC; US Steel bought Marathon when oil was very high so they paid a premium price for it. They later "spun off" ie dumped, Marathon when oil had plummeted. Maybe one of the worst business moves of my lifetime.

Thursday, November 21, 2013 9:19:00 AM  
Blogger C. Briem said...

Indeed... except there is one caveat. Oil prices were already dropping by November 1981. They paid a high price for sure, but oil's peak pricing was already past in both nominal prices, and clearly dropping in real prices. In a data driven world people just believe what they want to believe.

Some have asked about the HQ moving. The USS division of USX remained here of course. When the firm again divested itself the 'new' USS was HQ here. But not all that much changed in a sense

Thursday, November 21, 2013 4:51:00 PM  

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