TimkenSteel (NYSE: TMST) announced plans to locate a new manufacturing facility in Perry Township near Canton, Ohio for its value-added steel operations.
The company will invest $40 million into the project to establish the plant on the same site as the TimkenSteel Gambrinus Steel Plant.
The new facility will be fully operational within two years, and will have 12 full-time employees performing heat-treat operations with an annual capacity of 50,000 process-tons of four to thirteen inch bars and tubes.
Perry Township and Stark County secured the project with state support and assistance from Ohio economic development organization JobsOhio.
Shawn J. Seanor , executive vice president of Energy and Distribution, TimkenSteel, said in a release that their decision to locate the new operation near their Canton facilities offers operational benefits and comes after strong local and state support.
The company’s release did not disclose details about the economic development incentives that TimkenSteel is getting for the project. According to a report in the Canton Repository, TimkenSteel is getting a $100,000 workforce training grant from JobsOhio, and Stark County has approved a 10-year, 60 percent tax abatement.
This investment and expansion of their operations in Northeast Ohio follows a larger $225 million investment announced in 2012 at the company’s Faircrest Steel Plant in Stark County. That investment in turn was announced immediately after The Timken Company and members of USW Local 1123 agreed on a new five-year labor agreement.
That labor agreement covers four of the company’s plants in Stark County through Sept 2017, and replaced an older agreement that would have expired in the middle of the new investment project. Overall, Timken has invested around $500 million after initiating an improvement program of its Northeast Ohio steel operations in 2006.
This latest $40 million investment is significant because it is the first major investment made by TimkenSteel after it was spun off from The Timken Company (NYSE: TKR) as a separate publicly traded company earlier this year in June.
Stark County and Ohio secured the new $40 million project despite competition from another location in the Houston area in Texas. The new investment and the continuity of the labor agreement through 2017 ensure that TimkenSteel facilities will have just as big a presence and growth in Northeast Ohio as they did under The Timken Company.
TimkenSteel’s global operations include facilities in six countries that together have around 3,000 employees. The company is one of the leading producers of large alloy steel bars and seamless mechanical tubing in North America, and generated sales of $1.4 billion last year.