Steel Mills
Ontario Steelworks Makes Bid for USSC
Written by Sandy Williams
August 9, 2016
Ontario Steel Investments Limited (Ontario Steelworks) said on Tuesday that it has submitted a bid to buy US Steel Canada. The August 5th offer includes the assumption of the US Steel Canada pension plan, currently estimated at C$954 million ($724 million) and a commitment to provide C$25 million per year for post-employment benefits for current and retired employees. The purchase price for the former Stelco steelworks was not disclosed.
Ontario Steelworks, a consortium of steel industry specialist, including Essar Global shareholders, provided the following comment in a press release:
“We are very excited to put this bid forward for Stelco; it is another important step in advancing our vision of creating a true Canadian steel champion. Our Offer is the culmination of 18 months of discussions with all of the key stakeholders to find the best outcome for the business. It will provide maximum benefit to all involved, most importantly Stelco’s active and retired employees who depend on their pensions and post-employment benefits, as well as a more secure day-to-day operating environment.”
“Through its affiliation with Essar Global, Ontario Steelworks brings over 25 years of global experience in steel manufacturing as well as a best in class operating team, leading edge technology and deep financial capabilities. With this, we believe we are uniquely positioned to bring Stelco out of the CCAA restructuring process and create a foundation for a strong, competitive and sustainable steel business in Hamilton and Lake Erie.”
“Ontario Steelworks remains in active discussions with the United Steelworkers Union regarding its Offer for Stelco, and we look forward to continuing discussions with the Province of Ontario to ensure the long term interests of the community and the environment are protected.”
Ontario Steelworks submitted a letter of intent on July 12, 2016 to USW Local 2251 to negotiate for the purchase of Essar Steel Algoma. Ontario Steelworks said it plans to combine Algoma and USSC.
Ontario Steelworks also announced the launching of a new website http://workingforontariosteel.ca/ to provide the community information related to its interest in the Ontario steel industry. The Company states in its Vision: “We are committed to protecting jobs, pensions and benefits for workers at Algoma and Stelco, to being a responsible environmental steward, and to investing in technology and infrastructure that will return Ontario to leadership in global steel manufacturing.”
About Ontario Steelworks (from new website)
Ontario Steel Investment Limited (“Ontario Steelworks”) is an investment vehicle dedicated towards investing, rebuilding and supporting the steel industries located in the Province of Ontario – creating a Canadian Steel Champion.
Ontario Steel Works is a global consortium of investors led by the shareholders of Essar Global Fund Limited ‘EGFL’. EGFL is a global investor, with a portfolio of investments in the core sectors of Metals & Mining, Energy, Infrastructure and Services with a presence in 29 countries and employing more than 60,000 people and have adopted international standards of health and safety, environmental protection and corporate governance. EGFL’s investment in steel spans the globe.
($1 = 1.3155 Canadian dollars)
Sandy Williams
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