HAMILTON – A consortium led by Essar Global shareholders is making an offer to buy U.S. Steel Canada, formerly known as Stelco, which has been seeking a buyer under a lengthy court-supervised process.
The Ontario Steel Investments group hasn’t announced what it would pay for the business, which has its operations in southern Ontario at Hamilton and Nanticoke.
However, Ontario Steel says it’s offering to assume $954 million of employer liabilities under Stelco’s pension plans and a commitment to contribute $25 million per year towards “post-retirement” benefits for both active and retired employees.
The same group has also offered to buy Essar Steel Algoma Inc. in Sault Ste. Marie, in northern Ontario.
Both offers would require an agreement with the United Steelworkers, which has current and retired members at both Ontario steel companies.
U.S. Steel Canada has been operating under protection from the Companies’ Creditors Arrangement Act since September 2014. One of the biggest issues is the cost of U.S. Steel Canada’s legacy pension obligations for unionized employees.