Stelco restructuring inches forward as salaried workers agree to deal
The Ontario steel producer and Bedrock Industries still need to reach an agreement with the United Steelworkers before they can finalize the sale
HAMILTON, Ont.—Stelco is one step closer to emerging from creditor protection.
The southern Ontario steel producer and prospective buyer Bedrock Industries Group LLC have reached an agreement in principle with a group of Stelco’s salaried workers and retirees.
Stelco said the deal covers retirement benefits, unfunded supplemental pensions claims, termination and severance claims, and future pension service for the Hamilton and Nanticoke plants’ salaried employees. The workers, meanwhile, have agreed to vote in favour of the company’s reorganization plan of arrangement. The steel firm said more details about the deal should be available shortly.
But it does include the United Steelworkers locals, which Bedrock will need to clinch a final agreement.
“Momentum continues to build towards this great company having an opportunity to re-emerge as a strong, independent Canadian steel producer,” Bill Aziz, the company’s chief restructuring officer said in a statement.
“We are getting closer to the best—and only—outcome that balances the realities of the situation with the interests of the many stakeholders,” he added.
Known as U.S. Steel Canada for about 10 years before re-branding and returning to its roots at the end of last year, Stelco has been operating under the under Companies’ Creditors Arrangement Act since late 2014.
The agreement gives the steel firm some forward momentum going into next week’s vote, where the company hopes to gain the backing of its affected creditors to move forward with Bedrock’s purchase plan.