Ontario steelmaker Stelco files for IPO to pay for expansions in Hamilton, Nanticoke
The company, which emerged from creditor protection this July, plans to raise at least $150 million to add capacity at its Ontario steel mills
HAMILTON, Ont.—Ontario’s Stelco Holdings Inc. is planning an initial public offering.
The steelmaker, which was recently acquired by U.S. holding company Bedrock Industries Group after nearly three years of restructuring, filed a preliminary prospectus for an IPO with securities regulators in each province Sept. 27.
The company did not disclose how many shares it plans to sell, or for how much, but The Globe and Mail, citing sources familiar with the plan, said the company intends to sell at least $150 million in shares.
The company operates steel mills in Nanticoke and Hamilton, Ont. and manufactures a range of flat-rolled steels, as well as metallurgical coke. According to the prospectus, Stelco currently employs 2,227 workers, the vast majority being hourly employees. As of mid-September, the company said it has 576 salaried workers as well as 1,651 workers in hourly positions.
Stelco said it plans to use the funds raised in the IPO to make new capital investments, including possible co-generation facilities at its two steel plants and investments in fresh production capacity. Other proceeds will go toward general corporate purposes and pre-payments to certain employee pensions plans.
Prior to the Bedrock acquisition in July, the Ontario steel producer spent 10 years under the U.S. Steel Corp. banner.
Goldman Sachs and BMO Capital Markets will act as joint bookrunners for the IPO.