By the OGJ Online Staff
HOUSTON, Apr. 24 -- USX Corp., Columbus, Ohio, Tuesday announced plans to separate its energy business, USX-Marathon Group, and its steel business, USX-U.S. Steel Group.
Thomas J. Usher, chairman and CEO, said the plan is expected to be implemented by Dec. 31, subject to shareholder and regulatory approval. Last November, USX hired legal and financial advisors to review the corporate structure with the goal of enhancing shareholder value.
The plan envisions a tax-free spin-off of the steel and steel-related businesses of USX into a freestanding, publicly traded company known as United States Steel Corp.
Holders of USX-U.S. Steel Group stock would become holders of United States Steel Corp. stock. Holders of USX-Marathon Group stock would become holders of Marathon Oil Co. stock. No cash distribution to shareholders is planned.
Marathon Oil will remain headquartered in Houston, Marathon Ashland Petroleum LLC in Findlay, Ohio, and U. S. Steel in Pittsburgh.
Usher will become chairman and CEO of U.S. Steel. He also will become chairman of Marathon Oil and remain chairman of the Marathon Ashland. Clarence P. Cazalot will become president and CEO of Marathon Oil.
Usher said separating Marathon and U.S. Steel would give each company more flexibility in expanding its business through stock-based acquisitions, which is beneficial given global consolidation in both the energy and steel industries.
The separation also would allow Marathon and U.S. Steel to each make acquisitions based solely on its own business considerations.
Employees of both U.S. Steel and Marathon should not be adversely affected by the reorganization plan. In addition, retirees will continue to receive pension benefits, and no changes in any retiree benefit will result, Usher said.