Stelco announces end of mediation talks under the direction of George Adams

HAMILTON, ON, June 24 /CNW/ - Stelco Inc. (TSX:STE) today announced that
the mediation talks involving the Company and a number of its stakeholders
under the direction of the Hon. George Adams have ended.
In a letter delivered to the parties today, Mr. Adams indicated that the
mediated discussions of the past month, over which he had presided under the
direction of the Superior Court of Justice (Ontario), constituted "an
important exchange of perspective, data and possible solutions." He added,
however, that a comprehensive framework agreement had not been achieved, and
that he could not report that "further mediated talks at this time would
produce such an agreement." For these reasons, Mr. Adams decided to end his
involvement, urging the parties to "consider how they might bridge their
outstanding differences."
Courtney Pratt, Stelco President and Chief Executive Officer, said, "I
want to thank Mr. Adams for his time, hard work and commitment during this
process. We'll continue to seek a solution that reflects the needs and
interests of all stakeholders. As I've said for some time, it's important that
all parties work together and in the same direction so that we can find a
positive outcome."
The Company indicated that it would proceed to continue the dialogue with
other parties, examine the proposals that could form the basis of a
restructuring plan, pursue a solution in the interest of all stakeholders, and
seek to emerge from CCAA as a viable and competitive steel producer as quickly
as possible. In particular, the Company will work to resolve the pension
solvency deficiency issue and to pursue a fair and reasonable collective
agreement with USWA Local 8782 at Stelco's Lake Erie facility.
"The outcome we seek can't be based on the assumption that steel prices
will remain at historically high levels," Mr. Pratt noted. "We've said for
months that the prices of the past year were unlikely to continue. Since that
time, there has been a significant softening of market conditions and a marked
decline in steel prices.
"That's why we've stressed the urgency of securing agreement on a
restructuring plan, a plan that will enable Stelco to be viable through all
stages of the market cycle."
The Company noted that the Court has prohibited the parties from
discussing details of the mediation process until after Stelco's CCAA
proceedings have concluded.

About Stelco
Stelco Inc. is a large, diversified steel producer. Stelco is involved in
major segments of the steel industry through its integrated steel business,
mini-mills, and manufactured products businesses. This news release may
contain forward-looking information with respect to the Corporation's business
operations, financial performance and conditions. Actual results may differ
from expected results for a variety of reasons including factors discussed in
the Corporation's Management's Discussion and Analysis section of the
Corporation's 2004 Annual Report. To learn more about Stelco and its
businesses, please refer to our Web site at www.stelco.ca.

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