Steel Mills
Essar Steel Algoma in Financial Straits
Written by Sandy Williams
November 4, 2015
Recent media reports indicate that Essar Steel Algoma may be heading for another return to insolvency as it struggles to meet its debts. According to media reports, the company has engaged a law firm and restructuring specialist to advise it and may file for insolvency by the end of the month.
Although Essar Steel Algoma has not confirmed the reports, spokesperson Brenda Stenta at Essar Steel Algoma provided SMU with the following statement.
“With regards to the current situation, we are operating our business as always with a focus on delivering the best quality product to our customers and the health and safety of our employees,” wrote Stenta.”
“Recent staff layoffs reflect difficult times in the international and domestic steel business overall. World steel prices have fallen dramatically over the past year as a result of overcapacity and reduced demand in the energy and mining sectors. In Canada, this pressure has been increased by the proliferation of low-priced steel flooding the market.”
The company laid off 100 employees last month at its plate and cold mills. Last week, salaried workers from USW Local 2742 were asked to vote on a work-share proposal that would allow two employees to share a job, avoiding complete job loss. Workers rejected the proposal in a 77-23 vote.
When Essar Steel Algoma was under court protection in July 2014, parent company Essar Global stepped in to provide funding. Soo Today reports that Essar Group has a plan to sell a 50 percent stake in Essar Oil to provide financing for its ailing steel segment abroad and in Canada. It is not confirmed that Essar will divert any of the funds of that sale to Algoma.
Sandy Williams
Read more from Sandy WilliamsLatest in Steel Mills
SDI guides toward lower Q3 earnings on weaker flat-rolled steel prices
Steel Dynamics Inc. (SDI) expects lower third-quarter earnings on the heels of “meaningfully lower” prices at its flat-rolled steel operations. The Fort Wayne, Ind.-based steelmaker expects Q3’24 earnings of $1.94 to $1.98 per diluted share, according to figures released on Monday. That’s down from $2.72 per share in Q2’24 and down from $3.47 per share in Q3’23.
Stelco shareholders OK $2.5B sale to Cliffs
Stelco shareholders voted overwhelmingly on Monday to OK the $2.5-billion sale of the Canadian flat-rolled steelmaker to Cleveland-Cliffs. Indeed, 99.97% of those who cast ballots voted to approve the deal, according the Hamilton, Ontario-based steelmaker.
White House may delay decision on USS-Nippon deal until after election: report
The White House decision on blocking Nippon Steel’s play for Pittsburgh-based U.S. Steel might be pushed back until after the upcoming presidential election, according to a report in the Washington Post.
Hybar lands ‘strategic’ investment from Quanta Services
Hybar said that contracting services firm Quanta Services has made a “strategic” investment in the company as it build its sustainable rebar mill in northeast Arkansas.
Cliffs to place C-6 furnace at Cleveland Works on hot idle: sources
Cleveland-Cliffs plans to place the C-6 blast furnace at its Cleveland Works in Ohio on hot idle in October, according to sources familiar with the matter.