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Steel and Stainless Steel Industries

NEWS RELEASE: Trudeau Must Act to Avert ‘Irreversible Harm’ to Canadian Steel Sector

http://www.usw.ca

Steel producers, Steelworkers union call for action from Prime Minister

OTTAWA, Sept. 1, 2016 /CNW/ – Canadian steel producers and the United Steelworkers (USW) are jointly urging Prime Minister Justin Trudeau, during his official visit to China, to strongly pursue a multinational solution to a steel crisis caused by global overcapacity and unfair trade.

In an open letter to the prime minister, the Canadian Steel Producers Association (CSPA) and the USW warn of “irreversible harm” to Canada’s steel industry, which supports more than 120,000 jobs.

Meaningful solutions must be adopted internationally and on the domestic front, states the letter, signed by CSPA President Joseph Galimberti and USW National Director Ken Neumann.

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STELCO SALE: Locals outraged at Ottawa’s “deafening silence” on steel industry – by Steve Arnold (Hamilton Spectator – August 23, 2016)

http://www.thespec.com/

Union leaders, Opposition MPs and even the Chamber of Commerce are pressing the federal government to help Canada’s struggling steel industry. Two Hamilton Members of Parliament, three chambers of commerce and union leaders at the local and provincial levels separately have called for help for the industry and especially for retirees and workers in Hamilton.

NDP MPs Scott Duvall (Hamilton Mountain) and Dave Christopherson (Hamilton Centre) have written to Economic Development Minister Navdeep Bains, saying the federal government has stayed on the sidelines too long.

“To date, your government has not been tangibly involved in any way to help protect the jobs, benefits and pensions of current and former employees of USSC/Stelco despite commitments previously made by colleagues and the Prime Minister,” they wrote. “Workers, pensioners, the business community and the City of Hamilton have all appealed for your help. So far, you and your government have been missing in action.”

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Ontario Steel Investments bids on Hamilton plant – by Elaine Della-Mattia (Sault Star – August 9, 2016)

http://www.saultstar.com/

Ontario Steel Investments Ltd. has submitted a formal binding offer to purchase U.S. Steel Canada (Stelco). The total proposed purchase price of the offer has not been disclosed.

But the offer does include the assumption at closing of $954 million of employer liabilities under Stelco’s defined benefit registered pension plans and commitment to contribute $25 million per year towards post-employment benefits for active and retired employees, a press release states.

Ontario Steel Investments Ltd. is a new company established by Essar Global that includes a consortium of steel specialists. Ontario Steel Investments has also indicated they are interested in bidding on Essar Steel Algoma but a bid has not yet been formally presented.

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Wynne says steel important to Ontario economy – by Elaine Della-Mattia (Sault Star – August 9, 2016)

http://www.saultstar.com/

Ontario Premier Kathleen Wynne said the province needs a strong steel industry – especially one that can help build infrastructure for all Ontarians.

“We are building so much in Ontario right now – $160 billion over 12 years – and there is a lot of steel in that build,” she said in an exclusive interview with The Sault Star.

She was in Sault Ste. Marie Monday as part of an 18-stop, week-long tour of Northern Ontario communities. Monday’s formal announcement dedicated an additional $120 million to modernize Northern Ontario schools, bringing a total commitment to $300 million.

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KPS withdraws bids for Essar Algoma, U.S. Steel Canada – by Greg Keenan (Globe and Mail – July 15, 2016)

http://www.theglobeandmail.com/

KPS Capital Partners LP has abandoned its bids for Essar Steel Algoma Inc. and U.S. Steel Canada Inc., ending its effort to combine two Canadian steel mills that have been operating in creditor protection.

The New York-based private equity fund withdrew the bids because it was unable to reach agreements with the Ontario government, a source familiar with the matter said Thursday. The Ontario government was involved because of combined pension liabilities that exceeded $1-billion at the two steel makers, as well as unknown environmental costs.

KPS had teamed up with Essar Algoma’s term lending syndicate to make an offer that was anointed by Essar Algoma as the preferred bid. Its withdrawal from the U.S. Steel Canada sales process leaves Bedrock Industries Group LLC, another private equity fund, as the only bidder remaining in that auction.

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U.S. Steel: Essar inks deal with union to buy Algoma – by Steve Arnold (Hamilton Spectator – July 12, 2016)

http://www.thespec.com/

The Indian conglomerate planning to merge Stelco and Algoma into a new Canadian steel company is refusing to surrender its dream despite being defeated in bids for both companies.

Essar Global announced this week it has signed a deal with the United Steelworkers in Sault Ste. Marie to negotiate a framework deal to acquire Algoma through a subsidiary called Ontario Steel Investment Limited.

Gaining support of the union is a requirement for a successful bid for both struggling steelmakers. Essar is the union’s preferred bidder because it has promised to maintain jobs, pay up pension deficits and restore retiree health benefits. A competing bid by a New York-based hedge fund, however, is said to have rejected paying off pension shortfalls in favour of higher returns for debt holders.

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China is running out of time to cure its steel problems – by Andy Home (Reuters U.S. – June 28, 2016)

http://www.reuters.com/

China is frantically trying to apply the brakes to its runaway steel juggernaut. Targets are being set for capacity closures, 45 million tons nationally this year and 100-150 million tons over the next three to five years.

Regional governments are heeding Beijing’s call. Yunnan province, for example, has committed to eliminate 4.5 million tons of capacity by 2018. Local authorities are being urged to crack down on energy usage in the sector with those that fail to meet efficiency targets facing forced closure if they cannot improve.

A drive to consolidate the country’s fractured steel production landscape has begun with Baosteel, the second-largest Chinese operator, being pushed into a forced marriage with its smaller and financially weaker peer Wuhan Iron and Steel.

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U.S. Steel Canada sale behind-the-scenes maneuvers have workers worried – by Kelly Bennett (CBC News Hamilton – June 28, 2016)

http://www.cbc.ca/news/canada/hamilton/

Steelworkers call for government intervention in sale process

Unionized steelworkers are nervously eyeing the bidders that remain in a months-long process to buy U.S. Steel Canada and take over its Hamilton and Nanticoke operations.

One bidder has reportedly been knocked out of the running to buy U.S. Steel Canada, which has been operating under bankruptcy protection through the Companies’ Creditors Arrangement Act since 2014.

A spokesman for U.S. Steel Canada said the company “won’t discuss the identity or number of participants currently involved in the process” in order to abide by a non-disclosure agreement. But spokesman Trevor Harris said the process had winnowed out at least one party due to concerns about sufficient financial strength.

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China Eyes Steel Merger to Create Rival to ArcelorMittal (Bloomberg News – June 27, 2016)

http://www.bloomberg.com/

China’s second- and sixth-largest steelmakers by output have entered restructuring talks, which analysts say could presage a merger that would create the nation’s biggest mill, and a company with the scale to rival the likes of ArcelorMittal SA.

Trading was suspended in the listed units of state-run Shanghai Baosteel Group Corp. and Wuhan Iron & Steel Group Corp. as their parents discuss “strategic restructuring,” the companies said in statements on Sunday, without elaborating.

The two companies had a combined market value of $16.3 billion as of Friday’s close, and capacity of more than 70 million metric tons. Analysts including those at Citigroup Inc. and Mysteel Research cited the news as heralding a potential merger of the companies.

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Stelco suitor shown the door by U.S. Steel Canada, sources say – by Steve Arnold(Hamilton Spectator – June 27, 2016)

http://www.thespec.com/

Essar Global looks to be out; two investment funds said to be contenders

The pool of suitors for the former Stelco has been cut to two. Sources confirm the board of directors of U.S. Steel Canada has rejected a bid for the troubled company from Essar Global, the India-based conglomerate that owns Essar Steel Algoma in Sault St. Marie.

USSC spokesperson Trevor Harris said in an email exchange: “We continue to respect the integrity of the process and the (non-disclosure agreements) so won’t discuss the identity or number of participants currently involved in the process.

“However, I can confirm that certain parties previously involved are no longer involved in the sales and investor solicitation process, following a conclusion that they would not be able to complete a qualified bid that could result in a going-concern solution.”

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Steelworkers rain on Essar Algoma’s bid process – by Staff (Northern Ontario Business – June 23, 2016)

http://www.northernontariobusiness.com/

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.

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Essar Steel Algoma and U.S. Steel Canada eyed for potential merger – by Greg Keenan (Globe and Mail – June 23, 2016)

http://www.theglobeandmail.com/

Two perennial problem children of Canada’s steel industry would be merged into one steel maker if the New York private equity firm that has been nominated as the buyer for Essar Steel Algoma Inc. has its way.

“I can confirm that it is our intention to acquire each of Algoma and Stelco [U.S. Steel Canada] and merge them,” Mike Psaros, co-founder and co-managing partner of KPS Capital Partners LP, said Wednesday.

An offer by KPS and the term lenders of Essar Algoma has been chosen as the successful bid by Essar Algoma’s board. It is conditional on KPS signing a new labour contract with the unions that represent employees in Sault Ste. Marie, Ont., as well as an agreement with the Ontario government.

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Should Chevy Have Held Its Fire With Silverado “Bed Wars” Ad – by Mark Williams (Pickup Trucks.com – June 18, 2016)

http://news.pickuptrucks.com/

Why would anyone want to drop more than 800 pounds of expensive landscape blocks into a pickup bed from five feet in the air? Nobody in his or her right mind would allow a guy at the local building supply store to dump a load into a bed like that. We understand that’s not the point; like many nonsensical commercials nowadays — the point is that you could if you wanted to.

As it relates to the tiresome game of one-upmanship in pickup truck advertising, that kind of self-promotion (or attack promotion) seen in the latest Chevy Silverado commercial is likely to be around for a long time to come. And don’t get us wrong; we like healthy competition and testing and we want to see the results.

In fact, on a related note, it wasn’t that long ago that we had our first chance to drive the redesigned Honda Ridgeline.

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[Australia] The Biggest Steel City In The Country Is Hurting. But It’s Never The One You Hear About. – by Josh Butler (Huffington Post Australia – June 16, 20160

http://www.huffingtonpost.com.au/

Whyalla is a hot-button issue. Politicians don’t even visit Wollongong.

There’s a steel town on the Australian coastline that is hurting. It’s an area of high unemployment, low socioeconomic factors and a whole lot of steelworkers and fabricators who have never been anything other than steelworkers and fabricators.

The dual hits of the end of the mining boom and the flooding of global markets by cheap Chinese steel has eaten away at the profitability of the economy. It’s a town built on the steel industry, and those foundations are crumbling.

But it’s not Whyalla. It’s not the Arrium plant on the South Australian coast that we’ve been hearing so much about. There are no submarines being built here; no hastily hammered-out deal for a massive rail project that will give the steelworks and its employees some light, some hope, some money. This town is called Wollongong, it has the biggest steelworks in the country and is the 10th biggest city in Australia, it is under pressure, and nobody is talking about it.

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New GM ads hit Ford hard over aluminum pickup trucks – by Brent Snavely (U.S.A. Today – June 8, 2016)

http://www.usatoday.com/

Detroit Free Press – Chevrolet launched a new, national ad campaign Wednesday for its Silverado pickups that revives the often testy battle with crosstown rival Ford over who makes the biggest, best or toughest truck.

The ad campaign touts the results of lab tests that it says show how the Silverado’s roll-formed, high-strength steel bed suffers far less damage than the Ford F-150’s aluminum truck bed when a load of concrete blocks are dumped into the back of the trucks.

The ads debuted today with four-page wrap-around print advertisements in several major newspapers, including USA TODAY. General Motors also posted a 3-minute video that shows the cinder block demonstration with the F-150 truck bed getting gashed by the concrete blocks and the Silverado truck bed only being dented.

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