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Stelco Offers Miss the Mark
03/02/2005 - Stelco Inc.’s Board of Directors has determined that none of the proposals received satisfy its requirements for being designated as a prevailing offer under the order of the Ontario Superior Court of Justice. As a result, the Board will pursue new refinancing alternatives for the integrated steel business as part of its capital raising process.
Stelco Inc.’s Board of Directors has determined that none of the proposals received satisfy its requirements for being designated as a prevailing offer under the order of the Ontario Superior Court of Justice. As a result, the Board will pursue new refinancing alternatives for the integrated steel business as part of its capital raising process.
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Stelco and its advisors have spent the last two and half weeks examining in detail bids submitted by the bid submission date of February 14, 2005. In reviewing the bids, the corporation and its Board of Directors have been guided by the principle that the overall objective is to pursue an outcome that will strengthen the corporation on its emergence from protection under the Companies' Creditors Arrangement Act.
To permit Stelco to emerge from creditor protection as a competitive participant in the industry, the company expects to return to court in the near future to outline its plans for raising capital. The company believes that further capital raising activity will require it to directly pursue financing options working closely with various sources of capital to develop an alternative that will substantially strengthen the corporation.
Courtney Pratt, CEO, commented: "Our process unfortunately did not turn up any acceptable proposals from strategic or financial bidders. We will now be working with our financial advisors to aggressively attract new capital. We will also be working closely with the province to understand its requirements as a result of its decision to change the solvency deficiency pension plan funding rules for Stelco post-emergence from CCAA and we will be continuing to consult with our other stakeholders".
The Board of Directors remains highly focused on the task of emerging from Court protection with an appropriate eye to the broad range of stakeholder interests involved.
Stelco Inc. is a large, diversified steel producer involved in major segments of the steel industry through its integrated steel business, mini-mills, and manufactured products businesses.
