Essar Steel interested in bidding for both Hamilton and Nanticoke plants, according to a report
A foreign steel maker that has previously purchased a Sault Ste. Marie steel plant is interested in U.S. Steel’s Canadian operations, according to a report in the Hamilton Spectator.
Essar Steel Holdings, an India-based steel company, purchased Algoma Steel in 2007 for $1.85 billion. The company’s name curiously appeared in bankruptcy court documents a month earlier as a party to be notified about the progress and proceedings.
But the news should be met with “cautious optimism” as a formal bid has yet to be announced, said Ward 4 Coun. and steel sub-committee member, Sam Merulla.
“That would be a dream come true for our city,” Merulla added. “At this point it’s speculative.”
Industry analyst Chuck Bradford said the possibility of a new bidder could throw a wrench in U.S. Steel’s plans to dump the liabilities of the Canadian plants.
“A lot of people thought that U.S. Steel would probably end up buying it out of the bankruptcy… without the pensioners and debt liability,” Bradford said. “But other people have to also make bids, and there are some people who could bid for just a piece, and that could make the whole thing really messy.”
“And Essar, or Algoma, we’re not sure which one but they’re really the same, sounds like they’re interested in buying.”
Essar spokesperson Brenda Stenta declined to comment on a possible bid.
Essar opening Minnesota iron ore mine in 2016
U.S. Steel bought the former Stelco site in 2007. Shortly after it was purchased, the Hamilton plant was idled, and fixed operating costs began to erode any chance of profit. The Canadian operation declared bankruptcy last September.
For the rest of this article, click here: http://www.cbc.ca/news/canada/hamilton/news/u-s-steel-may-have-interested-buyer-in-india-based-steel-maker-report-1.3188185