Sep 27 2004
Stelco Inc. today obtained an Order of the Superior Court of Justice (Ontario) extending the stay period under its Court-supervised restructuring until November 26, 2004. While the Company's USWA Locals opposed the application, the Court-appointed Monitor and the representatives of other stakeholders, including the Canadian Auto Workers, supported an extension.
Courtney Pratt, Stelco President and Chief Executive Officer, said, "This reflects the fact that Stelco is insolvent and requires the protection of the Court-supervised restructuring process. Despite high steel prices, we can't generate sufficient funds internally to deal with our obligations without a restructuring.
"This extension also provides time to determine the options for raising the capital we need to address our obligations and to fund our essential capex program. Finding that new capital and funding those programs is the only way that Stelco can become a viable and cost competitive steel producer."
The Company will return to the Court on October 18, 2004 to seek approval of a process for the raising of new capital.
The Court today also approved the sale of the real property of CHT Steel Company Inc., a Stelco subsidiary located in Richmond Hill, Ontario, to a numbered Ontario company for a price in excess of the $3.25 million list price. It also approved an amendment to the previously-announced sale agreement in respect of certain assets of Welland Pipe Ltd.
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