TORONTO – Steel producer Essar Steel Algoma Inc. says it will seek bankruptcy protection as it deals with a continued slump in the price of steel.
The company has filed requests with Canadian and U.S. courts as it seeks to restructure its long-term debt, and has raised US$200 million from a group of investors led by Deutsche Bank to fund ongoing operations.
Essar Steel Algoma is the second-biggest steel producer in Canada and the largest employer in Sault Ste. Marie, Ont., with close to 3,000 employees.
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The company is a subsidiary of India-based global conglomerate Essar Steel.
In 2013, Essar Steel Algoma won a battle against organized labour when the Ontario government approved a new rule that allowed it to lower its pension contributions, which the company said had become unsustainable.
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