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Filed Pursuant to Rule 424(b)(1)
Registration No. 333-17023
1,000,000 SHARES
BIRMINGHAM STEEL CORPORATION
COMMON STOCK
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This Prospectus relates to 1,000,000 shares (the "Shares") of Common Stock,
par value $.01 per share (the "Common Stock") being offered by Birmingham Steel
Corporation, a Delaware corporation (the "Company").
The Common Stock is listed on the New York Stock Exchange (the "NYSE")
under the symbol "BIR." On January 16, 1997, the last reported sale price of the
Common Stock as reported on the NYSE was $19.75 per share.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS
PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
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<TABLE>
<CAPTION>
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Underwriting
Price to Discounts and Proceeds to
Public Commissions(1) Company(2)
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<S> <C> <C> <C>
Per Share......................... $19.625 $.4375 $19.1875
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Total............................. $19,625,000 $437,500 $19,187,500
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</TABLE>
(1) See "Underwriting."
(2) Before deducting expenses estimated at $66,339.66, which are payable by the
Company.
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The shares of Common Stock are offered by the Underwriter, subject to prior
sale, when, as and if delivered to and accepted by the Underwriter, and subject
to its right to reject orders in whole or in part. It is expected that delivery
of the Common Stock will be made in New York, New York, on or about January 23,
1997.
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PAINEWEBBER INCORPORATED
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THE DATE OF THIS PROSPECTUS IS JANUARY 16, 1997.
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IN CONNECTION WITH THIS OFFERING, THE UNDERWRITER MAY OVER-ALLOT OR EFFECT
TRANSACTIONS WHICH STABILIZE OR MAINTAIN THE MARKET PRICE OF THE COMMON STOCK AT
A LEVEL ABOVE THAT WHICH MIGHT OTHERWISE PREVAIL IN THE OPEN MARKET. SUCH
TRANSACTIONS MAY BE EFFECTED ON THE NEW YORK STOCK EXCHANGE, IN THE
OVER-THE-COUNTER MARKET OR OTHERWISE. SUCH STABILIZING, IF COMMENCED, MAY BE
DISCONTINUED AT ANY TIME.
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AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy statements, and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549; and at the Commission's regional offices at 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661 and Seven World Trade Center, New York, New
York 10048. Copies of such material can be obtained from the Public Reference
Section of the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549 at
prescribed rates. The shares of the Company's Common Stock are listed on the New
York Stock Exchange Inc. ("NYSE"). Reports, proxy statements and other
information concerning the Company can also be inspected at the offices of the
NYSE, 20 Broad Street, New York, New York 10005. In addition, the Commission
maintains a site on the World Wide Web at http://www.sec.gov that contains
reports, proxy and information statements and other information regarding the
Company and other registrants that file electronically with the Commission.
This Prospectus, which constitutes a part of a registration statement (the
"Registration Statement") filed by the Company with the Commission under the
Securities Act of 1933, as amended, omits certain of the information set forth
in the Registration Statement. Reference is hereby made to the Registration
Statement and to the exhibits thereto for further information with respect to
the Company and the securities offered hereby. Statements contained herein
concerning the provisions of such documents are necessarily summaries of such
documents, and each statement is qualified in its entirety by reference to the
copy of the applicable document filed with the Commission. Copies of the
Registration Statement and the exhibits thereto are on file at the offices of
the Commission and may be obtained upon payment of the prescribed fee or may be
examined without charge at the public reference facilities of the Commission
described above.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference: (i) the Company's Annual Report on Form 10-K
for the fiscal year ended June 30, 1996, as amended as of January 15, 1997, (ii)
the Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
1996, (iii) the Company's Current Report on Form 8-K, dated December 12, 1996,
as amended as of January 15, 1997, and (iv) the description of the Company's
Common Stock contained in the Company's Registration Statement on Form 8-A as
filed with the Commission on January 22, 1988.
All documents filed pursuant to Section 13(a), 13(c), 14 or 15(d) of the
Exchange Act subsequent to the date of this Prospectus and prior to the
termination of the offering of the securities offered hereby shall be deemed to
be incorporated by reference in this Prospectus and to be a part hereof. Any
statement contained in a document incorporated or deemed to be incorporated by
reference hereto shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is deemed to be incorporated by reference
herein modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered upon the written or oral request of any such person, a
copy of any of the above documents (excluding exhibits to such documents, unless
such exhibits are specifically incorporated by reference therein). Such requests
should be directed to Catherine W. Pecher, Vice President and Secretary,
Birmingham Steel Corporation, 1000 Urban Center Drive, Suite 300, Birmingham,
Alabama 35242-2516 (telephone (205) 970-1200).
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THE COMPANY
Birmingham Steel Corporation (the "Company") is a manufacturer of commodity
grade steel products and high quality rod, bar and wire products. The Company
operates four non-union mini-mills located across the United States that produce
primarily steel reinforcing bar ("rebar") and merchant products on a low-cost
basis. The Company also specializes in manufacturing high quality steel rod, bar
and wire products from semi-finished billets at its American Steel and Wire
("ASW") subsidiary. The Company, through its rebar/merchant facilities, produces
carbon steel rebar products sold primarily to independent fabricators for use in
the construction industry, and merchant products which include rounds, flats,
squares, strip, angles and channel which are sold to fabricators, steel service
centers and original equipment manufacturers for use in general industrial
applications. The Company's principal executive offices are located at 1000
Urban Center Drive, Suite 300, Birmingham, Alabama, and its telephone number is
(205) 970-1200.
RECENT DEVELOPMENTS
On December 20, 1996, the U.S. District Court for the Northern District of
California approved the terms of the Settlement and Release Agreement (the
"Settlement Agreement") between Barbary Coast Steel Corporation, a wholly owned
subsidiary of the company ("BCSC"), and various other parties to the action
styled IMACC Corporation v. Warburton, et al., in which BCSC was both a
defendant and counter-claimant. The claims in this case were brought under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980
("CERCLA") with respect to property which is adjacent to BCSC's closed steel
facility in Emeryville, California on which an industrial drum and barrel
reconditioning facility operated from the 1940's until 1991 (the
"IMACC/Emeryville Property"). The Settlement Agreement provides, among other
things, that IMACC will pay to BCSC $250,000 in respect of BCSC's counter-claims
and that BCSC will then contribute $380,000 to an escrow account to be
established for the payment and reimbursement of costs incurred to remediate the
contaminated property immediately adjacent to the BCSC property. The parties to
the Settlement Agreement will dismiss their respective claims and counter-claims
against each other, and BCSC is presently negotiating mutual release agreements
with the other parties in the action.
USE OF PROCEEDS
The net proceeds from the sale of the Shares offered by the Company are
estimated to be $19,121,161. The Company will use all of the proceeds from the
sale of the Shares to finance certain payments made by it under that certain
Contribution Agreement (the "Contribution Agreement"), dated as of November 15,
1996, among IVACO, Inc., a Canadian corporation ("IVACO"), Atlantic Steel
Industries, Inc., a New York corporation ("Atlantic"), the Company and
Birmingham Southeast, LLC, a Delaware limited liability company ("Birmingham
Southeast"), pursuant to which the Company and Atlantic formed Birmingham
Southeast to own and operate a steel making facility located in Jackson,
Mississippi, formerly owned by the Company, and a steel making facility located
in Cartersville, Georgia, formerly owned by Atlantic, a subsidiary of IVACO. The
Company's remaining financial obligations under the Contribution Agreement will
be funded using available cash from operations and the Company's bank lines of
credit. The Company currently has $185 million in available bank lines of
credit, of which approximately $122 million had been drawn as of December 31,
1996, and of which approximately $63 million were available for use by the
Company as of that date. See "The Transaction."
THE TRANSACTION
The transactions contemplated by the Contribution Agreement (the
"Transaction") were completed on December 3, 1996. In the Transaction, the
Company contributed to Birmingham Southeast substantially all of the operating
assets of a steel making facility located in Jackson, Mississippi, consisting
primarily of real property, and $43.3 million in cash, in exchange for 85% of
the membership interest in Birmingham Southeast, and Atlantic contributed
substantially all of the operating assets of a steel making facility located in
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<PAGE> 4
Cartersville, Georgia, consisting primarily of real property, in exchange for
15% of the membership interest in Birmingham Southeast and $43.3 million in
cash.
DESCRIPTION OF CAPITAL STOCK
The authorized capital stock of the Company consists of 75,000,000 shares
of Common Stock, par value $.01 per share, and 5,000,000 shares of Preferred
Stock, par value $.01 per share. As of December 31, 1996, 28,657,110 shares of
the Company's Common Stock were issued and outstanding, including 1,060,940
shares held in treasury, and an aggregate of 593,000 shares were reserved for
issuance pursuant to the Company's stock compensation plans. The following
description of the capital stock is qualified in all respects by reference to
the Restated Certificate of Incorporation, as amended, and By-laws, as amended,
of the Company, copies of which are on file at the Company's principal executive
offices.
COMMON STOCK
The holders of Common Stock, subject to such rights as may be granted to
the holders of Preferred Stock, elect all directors and are entitled to one vote
per share. All shares of Common Stock participate equally in dividends when, as
and if declared by the Board of Directors and share ratably, subject to the
rights and preferences of any Preferred Stock, in net assets on liquidation.
Shares prior to this offering are and shares to be outstanding upon completion
of this offering will be duly authorized, validly issued, fully paid and
nonassessable by the Company upon issuance. The shares of Common Stock have no
preference, conversion, exchange, preemptive or cumulative voting rights.
PREFERRED STOCK
The Company is authorized to issue 5,000,000 shares of Preferred Stock, par
value $.01 per share, none of which is outstanding. Preferred Stock may be
issued from time to time by the Board of Directors of the Company, without
stockholder approval, in such series and with such preferences, conversion,
redemption or other rights, voting powers, rights and preferences upon
liquidation, restrictions, limitations as to dividends, qualifications or other
provisions, as may be fixed by the Board of Directors in the resolution
authorizing the issuance. The issuance of Preferred Stock by the Board of
Directors could adversely affect the rights of holders of shares of Common
Stock; for example, the issuance of Preferred Stock could result in a class of
securities outstanding that would have certain preferences with respect to
dividends and in liquidation over the Common Stock, and that might enjoy certain
voting rights, contingent or otherwise, in addition to those of the Common
Stock, and that could result in a dilution of the voting rights, net income per
share and net book value of the Common Stock. In addition, while the Board of
Directors has no current intention of doing so, the ability of the Board of
Directors to issue shares of preferred stock and to set the voting rights,
designations, preferences, qualifications, limitations and restrictions thereof
without further stockholder action could be utilized as an anti-takeover measure
and thwart a takeover attempt, notwithstanding the desire of stockholders to
change management or accept a takeover proposal. As of the date of this
Prospectus, the Company's management is not aware of any efforts to take over or
acquire control of the Company.
RIGHTS AGREEMENT
On January 16, 1996, the Board of Directors of the Company declared a
dividend of one preferred share purchase right (a "Right") for each outstanding
share of Common Stock. Each Right entitles the registered holder to purchase
from the Company one one-hundredth of a share of Series A Junior Participating
Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"), of
the Company at a price of $74 per one one-hundredth of a share of Series A
Preferred Stock, subject to adjustment. The description and terms of the Rights
are set forth in a Rights Agreement dated as of January 16, 1996, as the same
may be amended from time to time, between the Company and First Union National
Bank of North Carolina, as Rights Agent.
The Rights are exercisable only after a person (other than the Company or
its employee benefit plans), together with all persons acting in concert with
it, has acquired 10% or more of the Common Stock, or has commenced a tender
offer for 10% or more of the Common Stock. If the Company engages in certain
business
4
<PAGE> 5
combinations or a 10% shareholder engages in certain transactions with the
Company, the Rights become exercisable for the Common Stock or common stock of
the corporation acquiring the Company (as the case may be) at 50% of the then
market price. Any Rights that are or were beneficially owned by a person who has
acquired 10% or more of the Common Stock and who engages in certain transactions
or realizes the benefits of certain transaction with the Company will become
void. The Company may redeem the Rights at a specified price at any time until
ten business days after public announcement that a person has acquired 10% or
more of the outstanding shares of Common Stock. The Rights will expire on
January 16, 2006, unless earlier redeemed by the Company. Unless the Rights have
been previously redeemed, all shares of Common Stock issued by the Company will
include Rights, including the Common Stock offered hereby.
The Rights have certain anti-takeover effects. The Rights will cause
substantial dilution to a person or group that attempts to acquire the Company
on terms not approved by the Board of Directors, except pursuant to an offer
conditioned on a substantial number of Rights being acquired. However, the
Rights should not interfere with any merger or other business combination
approved by the Board of Directors since (subject to the limitations described
above) the Rights may be redeemed by the Company at the Redemption Price prior
to the Distribution Date. Thus, the Rights are intended to encourage persons who
may seek to acquire control of the Company to initiate such an acquisition
through negotiations with the Board of Directors.
CERTAIN PROVISIONS OF THE BY-LAWS
The By-laws provide that special meetings of stockholders may be called by
the chairman or by a majority of the Board of Directors. The By-laws also
establish an advance notice procedure for the nomination, other than by or at
the direction of the Board of Directors, of candidates for election as directors
as well as for other stockholder proposals to be considered at annual meetings
or special meetings of stockholders. In general, notice of intent to nominate a
director or of other stockholder proposals must be received by the secretary of
the Company not less than 60 nor more than 90 days prior to the date of the
first anniversary of the preceding year's annual meeting, and must contain
certain specified information concerning the person to be nominated. There are
similar notice requirements for special meetings of stockholders. The existence
of these provisions in the Company's By-laws may have the effect of discouraging
a change in control of the Company and limiting shareholder participation in
certain transactions or circumstances by limiting shareholders' participation to
annual and special meetings of shareholders and making such participation
contingent upon adherence to certain prescribed procedures.
DELAWARE ANTI-TAKEOVER LAW
The Company is subject to the provisions of Section 203 of the Delaware
General Corporation Law (the "Anti-Takeover Law") regulating corporate
takeovers. The Anti-Takeover Law prevents certain Delaware corporations,
including those whose securities are listed on the New York Stock Exchange, from
engaging, under certain circumstances, in a "business combination" (which
includes a merger or sale of more than 10% of the corporation's assets) with any
"interested stockholder" (a stockholder who acquired 15% or more of a
corporation's outstanding voting stock without the prior approval of the
corporation's board of directors) for three years following the date that such
stockholder became an "interested stockholder." The current stockholders of the
Company may not, by virtue of their current holdings, be deemed to be
"interested stockholders" under this statute. A Delaware corporation may "opt
out" of the Anti-Takeover Law with an express provision in its original
certificate of incorporation or an express provision in its certificate of
incorporation or by-laws resulting from a stockholders' amendment approved by at
least a majority of the outstanding voting shares. The Company has not "opted
out" of the provisions of the Anti-Takeover Law.
REGISTRAR AND TRANSFER AGENT
The Company's registrar and transfer agent is First Union National Bank of
North Carolina, Charlotte, North Carolina.
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UNDERWRITING
Subject to the terms and conditions of the Underwriting Agreement between
the Company and PaineWebber Incorporated (the "Underwriter"), the Underwriter
has agreed to purchase from the Company all of the shares of Common Stock
offered hereby.
The Underwriting Agreement provides that the obligations of the Underwriter
thereunder are subject to approval of certain legal matters by counsel for the
Company and to various other conditions. The nature of the Underwriter's
obligations is such that, if any of the foregoing shares of Common Stock are
purchased by the Underwriter, all such shares must be so purchased. A copy of
the form of Underwriting Agreement is an exhibit to the Registration Statement
of which this Prospectus is a part.
The Company has been advised that the Underwriter proposes to offer the
shares of Common Stock to the public initially at the public offering price set
forth on the cover page of this Prospectus and to certain selected dealers at
such public offering price less a concession not in excess of $.25 per share.
The Underwriter may allow, and the selected dealers may re-allow, a concession,
not in excess of $.10 a share to certain other dealers. After the initial
offering to the public, the offering price and other selling terms may be
changed.
The Company has agreed to indemnify the Underwriter against certain
liabilities, including liabilities under the Securities Act of 1933, as amended,
or to contribute to payments that the Underwriter may be required to make in
respect thereof.
LEGAL MATTERS
Certain legal matters with respect to the legality of the shares of Common
Stock offered will be passed upon for the Company by Balch & Bingham LLP,
Birmingham, Alabama. Certain legal matters in connection with this offering are
being passed upon for the Underwriters by Shereff, Friedman, Hoffman & Goodman,
LLP, New York, New York.
EXPERTS
The consolidated financial statements (and schedules) of the Company
appearing in the Company's Annual Report (Form 10-K) for the year ended June 30,
1996, have been audited by Ernst & Young LLP, independent auditors, as set forth
in their report thereon included therein and incorporated herein by reference.
Such consolidated financial statements and schedules are incorporated by
reference in reliance upon such report given upon the authority of such firm as
experts in accounting and auditing.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Statements contained or incorporated in this Prospectus which are not
purely historical or which might be considered an opinion or projection
concerning the Company or its business, whether express or implied, are
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995. These statements include, without limitation,
statements expressing the Company's expectations, hopes, anticipations,
intentions, plans or strategies regarding the future. All forward-looking
statements included or incorporated in this Prospectus are based upon
information available to the Company on the date hereof, and the Company assumes
no obligation to update any such forward-looking statements. It is important to
note that the Company's actual results could differ materially from those
described or implied in such forward-looking statements. Among the factors that
could cause actual results to differ materially are the factors described in the
Company's Quarterly Report on Form 10-Q for the quarter ended September 30,
1996, under the caption "Risk Factors That May Affect Operating Results," which
report is incorporated herein by reference. Consideration should also be given
to the risks and qualifications described from time to time in the Company's
reports on Forms 10-Q, 8-K, 10-K, and Annual Report to Stockholders.
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NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS IN CONNECTION WITH THIS OFFERING OTHER THAN THOSE CONTAINED IN
THIS PROSPECTUS, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION AND
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY
OR THE UNDERWRITER. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE
HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE ANY IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO ITS DATE.
THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN
OFFER TO BUY ANY SECURITIES OTHER THAN THE REGISTERED SECURITIES TO WHICH IT
RELATES. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION
OF AN OFFER TO BUY SUCH SECURITIES IN ANY CIRCUMSTANCES IN WHICH SUCH OFFER OR
SOLICITATION IS UNLAWFUL.
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TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
Available Information................. 2
Incorporation of Certain Information
by Reference........................ 2
The Company........................... 3
Recent Developments................... 3
Use of Proceeds....................... 3
The Transaction....................... 3
Description of Capital Stock.......... 4
Underwriting.......................... 6
Legal Matters......................... 6
Experts............................... 6
Special Note Regarding Forward-Looking
Statements.......................... 6
</TABLE>
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1,000,000 SHARES
BIRMINGHAM STEEL
CORPORATION
COMMON STOCK
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PROSPECTUS
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PAINEWEBBER INCORPORATED
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JANUARY 16, 1997
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