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ISG may purchase Bethlehem Steel

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International Steel Group, which is controlled by the investor Wilbur L. Ross Jr., was expected to announce a plan as early as Monday to buy many of the assets of the bankrupt Bethlehem Steel Corp., creating the nation's largest steel company.

The deal, which has been under discussion for two months, could help save the 100-year-old steel company and the jobs of many of its employees.

Still, thousands of Bethlehem's 12,000 employees are likely to lose their jobs, and retirees are likely to lose benefits that had been part of their pensions.

Monday was the last day of 60 days in which International Steel had the exclusive right to negotiate with Bethlehem Steel, which has been operating under protection of Chapter 11. Any deal will require the approval of the bankruptcy court.

Last week, Ross said he was close to a deal, but he acknowledged that "unfortunately it will not be one that provides a significant recovery for the unsecured creditors, and none at all for the stockholders."

Ross set up International Steel last year when he bought LTV Steel out of bankruptcy and later Acme Metals.

A major sticking point has been the fate of Bethlehem Steel's 67,000 retirees and their pension plan, which is underfunded by $4.3 billion.