U. S. Steel Canada Gets the Go-Ahead to Initiate a New Sales Process
01/13/2016 - A Canadian court has signed off on U. S. Steel Canada Inc.’s plan to try, for a second time, to find a buyer, according to The Hamilton Spectator newspaper.
The approval followed five hours of closed-door meetings on 12 January between the court and various stakeholder groups, including the United Steelworkers union and United States Steel Corporation, which is separating itself from its Canadian operation.
The Steelworkers, along with salaried employees and the Ontario provincial government, had opposed the sales process partly on grounds that U. S. Steel could gain access to bid and information that could be used to thwart potential buyers and liquidate a competitor, the newspaper reported.
U. S. Steel argued that it is entitled to information about potential bids because it is USSC’s largest creditor and has a direct economic interest in the restructuring. A trial is set to begin later this week on U. S. Steel’s $2.2 billion in debt claims on USSC.
The union also has said that rushing into another sales process threatens discussions it has been having with bidders who are potentially interested in USSC’s mills in Nanticoke and Hamilton.
According to Canadian broadcaster CBC, another of the compromises that was reached allows the union to put together its own restructuring plan to be considered alongside other offers.
As for the potential sale, USSC was proposing to send out “teaser letters" to potential buyers as early as 1 February, making non-binding expressions of interest due by the end of the month. The goal was to select winning offers by the end of October, The Spectator reported.
The Steelworkers, along with salaried employees and the Ontario provincial government, had opposed the sales process partly on grounds that U. S. Steel could gain access to bid and information that could be used to thwart potential buyers and liquidate a competitor, the newspaper reported.
U. S. Steel argued that it is entitled to information about potential bids because it is USSC’s largest creditor and has a direct economic interest in the restructuring. A trial is set to begin later this week on U. S. Steel’s $2.2 billion in debt claims on USSC.
The union also has said that rushing into another sales process threatens discussions it has been having with bidders who are potentially interested in USSC’s mills in Nanticoke and Hamilton.
According to Canadian broadcaster CBC, another of the compromises that was reached allows the union to put together its own restructuring plan to be considered alongside other offers.
As for the potential sale, USSC was proposing to send out “teaser letters" to potential buyers as early as 1 February, making non-binding expressions of interest due by the end of the month. The goal was to select winning offers by the end of October, The Spectator reported.
