Stelco Confirms Strategic Review
06/04/2007 - Stelco confirmed that it is reviewing strategic options, including third-party discussions that are at “a very preliminary stage”.
Stelco Inc. confirmed that it is reviewing strategic options in light of the ongoing steel industry consolidation.
"Since emerging from CCAA, Stelco has been committed to building a stronger, more cost-efficient steel company, which would eventually become part of the global consolidation in the industry,” stated Rodney Mott, President and CEO. “As part of the restructuring efforts, Stelco has focused on completing the upgrade of the Lake Erie Hot Mill and addressing productivity and cost issues at the Hamilton works.”
Noting its intention to evaluate a broad range of possible alternatives—including mergers, strategic partnerships, acquisitions or a sale of all or part of the company—the company says that it has appointed a special committee of directors plus CIBC World Markets and UBS to assist it in this review.
“We believe it is appropriate to begin the next phase of our business plan and explore all potential alternatives for positioning Stelco to be an integral part of a larger, globally competitive company," said Mott.
Discussions with third parties are at a very preliminary stage, according to Stelco, and there have been no discussions on the material terms of any transaction. The company noted that there is no assurance that a transaction will result from these discussions or as to the timing, structure or terms of any transaction, and there will be no further comment unless the situation warrants.
Stelco, one of Canada's largest steel companies, is focused on its two Ontario-based integrated steel businesses located in Hamilton and in Nanticoke. These operations produce high quality value-added hot rolled, cold rolled, coated sheet and bar products.
