SCHEDULE 14A
(RULE 14a-101)
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
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Rule 14a-6(e)(2))
{ } Definitive Proxy Statement
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{_} Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
BIRMINGHAM STEEL CORPORATION
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(Name of Registrant as specified in its charter)
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(Name of person(s) filing proxy statement, if other than Registrant)
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[LOGO] CONTACT: ROY WINNICK
KEKST AND COMPANY
212-521-4842
BIRMINGHAM STEEL SENDS LETTER TO THE UNITED GROUP
BIRMINGHAM, Ala., November 22, 1999 - Birmingham Steel Corporation (NYSE:
BIR) said that the Company's Board of Directors today sent a letter to the
United Group reiterating the Board's continued willingness to meet with
representatives of the dissident group to discuss issues of mutual interest
and concern.
The letter follows the report issued by Institutional Shareholder Services
(ISS) last Thursday in which ISS recommended that stockholders re-elect the
Company's nominees for the Board of Directors at the Annual Meeting of
Stockholders on December 2nd, and reject the attempt by the dissident
United Group to replace the Company's incumbent directors with the board
slate put forth by the United Group.
In today's letter to the United Group, Birmingham Steel's Board expressed
its continued willingness:
o to review with representatives of the United Group the Company's
strategic restructuring plan and the circumstances that underlie it;
o to review any plan which the United Group believes might be effective
in maximizing value for the shareholders of Birmingham Steel; and
o to re-offer, as it has done in the past in an effort to avoid the
current costly and disruptive proxy contest, representation to the
United Group on the Company's Board of Directors.
The Board also urged the United Group to follow its lead in putting the
interests of the Company's shareholders first.
The full text of the letter follows:
November 22, 1999
The United Company Shareholder Group
1005 Glenway Avenue
Bristol, Virginia 24201
Gentlemen:
We are writing based on our concern that the best interests of
Birmingham Steel's shareholders may not be served without all parties
acting with full knowledge.
The interests of the Board of Directors of Birmingham Steel, eight
of whose members are independent directors, have been, and continue to be,
to serve the best interests of the shareholders of Birmingham Steel. In
that regard, we have spent considerable time evaluating Birmingham Steel's
businesses and developing a strategy based on a full knowledge of the
Company's circumstances. Our support of the Company's SBQ strategy is based
solely on our belief that this strategy has the greatest likelihood of
leading to the enhancement of shareholder value in light of the current
challenges facing the Company.
We have been, and continue to be, willing to review in detail with
representatives of the United Group the Company's plan and the
circumstances that underlie it. We would be equally prepared to review any
plan which the United Group believes might be effective in maximizing value
for the shareholders of Birmingham Steel.
We are also prepared to re-offer, as we did in the past,
representation to the United Group on the Birmingham Steel Board of
Directors. We do not, however, see, at this time, how the interests of
Birmingham Steel's shareholders would be served by effecting a
change-in-control of Birmingham Steel under circumstances where we do not
understand, in good conscience, that there is an alternative plan for the
Company, particularly regarding the SBQ division, which would prevent the
serious financial and competitive damage which we believe would result if
SBQ were to be retained even in the near term.
Our concern was reflected in the report recently issued by
Institutional Shareholder Services, a highly respected shareholder advisory
organization, when it stated, "there is more risk of permanent disaster by
keeping the SBQ assets and perpetuating the cash drain than there is by
divesting and reducing remaining debt via cash flow generated from the core
operations."
We are not asking that you commit to stand down from your proxy
contest. However, we are asking that you, like we, put the best interests
of all our shareholders first. We look forward to your prompt and
affirmative response. We are prepared to move ahead immediately. Please
direct all communications to our counsel, David J. Friedman.
Sincerely,
The Board of Directors of
Birmingham Steel Corporation
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Birmingham Steel operates in the mini-mill sector of the steel industry and
conducts operations at facilities located across the United States. The
common stock of Birmingham Steel is traded on the New York Stock Exchange
under the symbol "BIR."
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