While US Steel provided most of the steel for the Panama Canal, it provided every cubic yard of cement for the mammoth project. The company's purchase of Atlas Portland Cement Co. in 1930 made it the world's largest cement producer. One hundred years ago, the need to get bigger to compete drove Morgan and Schwab to form US Steel. A century later, consolidation is again at the forefront of industry buzz. Last week, French steelmaker Usinor said it will create the world's biggest steel company by acquiring Luxembourg's Arbed and Spain's Aceralia.
Analysts insist that few steel markets are as ripe for consolidation as the United States.
However, there are serious obstacles, including union contracts and unfunded employee and environmental liabilities. What few mergers there have been haven't produced tangible enough results to entice others to join the mating game. US Steel has shopped around but has yet to find a domestic deal it can live with. Moreover, given the increasingly global nature of the business, the company realizes it has to be a player overseas. Last year, US Steel acquired Slovak steelmaker VSZ, giving it a foothold in a promising foreign market.