Essar Steel Algoma’s largest union said it was not involved in the sale process that allowed a New York hedge fund to emerge as the best bet to take over the Sault Ste. Marie steel plant.
Local 2251 is emphatic that it “was NOT involved in the selection of KPS (Capital Partners) as a successful bidder,” said the union in a June 22 message to its members that was released to the media.
KPS is Essar Algoma’s preferred bidder in a proposal that, according to various media reports, would see the assets of the former Stelco steelworks in Hamilton and Nanticoke merged with Essar Algoma in Sault Ste. Marie into a single new Canadian steel producer. Essar Steel Algoma announced June 17 that it has entered into an asset purchase agreement for the sale of the steel works to a consortium of bidders headed up by KPS.
The company, which is under creditor protection, is seeking approval in an Ontario Superior Court. Finalizing the sale in August is subject to likely renegotiations of collective agreements and pension plans.
Despite being listed as one of the consulting partners in a solicitation and sale process, the union warned Essar and all stakeholders that it shouldn’t expect a ringing endorsement of the KPS offer.
“Being informed of a decision is not being involved in the making of a decision,” said the release. Leadership at 2251 is making it clear that it won’t be backed into a corner, bound by a gag order, and forced to “enter into secret negotiations” regarding revisions to collective agreements and retirement benefit issues.
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