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Stelco may soon be one step closer to emerging from creditor protection

U.S. Steel Corp.'s former Stelco plant has been a fixture on Hamilton's industrialized shoreline for decades. Frank Gunn/Canadian Press

This is another big week for the future of Hamilton-based Stelco as it attempts to emerge from creditor protection.

The company’s various creditors who are owed money are scheduled to vote on a proposal April 27 to settle with prospective buyer Bedrock Industries.

READ MORE: Steelworkers say more work needed before deal reached with Stelco, Bedrock

Bedrock already has agreements in principle with the provincial government, U.S. Steel and Stelco’s salaried employees and retirees.

It’s still waiting on approval from the United Steelworkers Union and the creditors.

McMaster business professor, Marvin Ryder, believes the creditors will approve the sale to Bedrock.

READ MORE: Steelmakers Stelco and Bedrock reach deal with salaried workers and retirees

“Because I think U.S. Steel’s weight with those creditors is so strong that it will be passed,” Ryder said.

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He says the company could then go to the bankruptcy court judge to argue that the Bedrock deal is the best way out of creditor protection.

Ryder says there is speculation that the judge may impose a settlement on the unions. But he doesn’t think that will happen.

LISTEN: Marvin Ryder joins the Bill Kelly Show

He believes the bankruptcy court judge may try to push the issue by asking the union and Bedrock to go to binding arbitration to reach a deal.

Ryder believes that the judge will say to the Steelworkers union “you are the odd person out of the puzzle, so let’s see if we can find some way, maybe binding arbitration, to find some way forward for you to sign on.”

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Steelworkers local 1005 president, Gary Howe, said last week that union negotiators met with Bedrock management earlier this month and gave a list of proposals that include job security and reinstatement of health care benefits.

He says the company has not yet said when it will respond.

The steelmaker has been operating under creditor protection since September 2014.

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