Good news from Stelco.
The Hamilton steelmaker says it has filed a preliminary prospectus with securities regulators in Canada for a proposed initial public offering of its shares.
Stelco Holdings Inc., which emerged from bankruptcy protection three months ago, has not determined how many shares will be sold or how much they will cost.
The company says it plans to use the funds from the IPO for capital investments to develop new products and enhance Stelco’s production capabilities.
It says the funds will also be used for early payment to certain pension and other post-employment benefits trusts, and for general corporate purposes, which could include additional capital investments.
Following the IPO announcement, Ontario Finance Minister Charles Sousa and Economic Development Minister Brad Duguid issued a joint statement:
“The Government of Ontario welcomes news that Stelco has filed a preliminary prospectus in preparation for taking the company public pursuant to a planned initial public offering. We believe that this development underscores the confidence that the new owners have in Stelco’s operations and its workers. The stated intentions of the owners to maintain their involvement and commit to new capital investments in the company’s operations is particularly welcome.
Throughout the long restructuring of Stelco, the province’s objective was to ensure a process that would lead to sustainable operations while protecting employees, pensions and the lands. With a combination of repayable loans as well as regulatory and policy accommodations, the government was able to help bring the players together to support a private-sector led, non-subsidized solution that secured Stelco’s stand-alone commercial viability. The province will continue to work with the stakeholders to fulfill the terms of the agreements, including the future of the Stelco lands, to secure maximum value for pensioners while consulting with the City of Hamilton in relation to ongoing local economic development and associated goals.”
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