Business
Stelco provides post-restructuring update
Stelco provides post-restructuring update.
About this update from Starr Peak Mining Ltd
[{"type":"text","content":"\n\n\n\n\nHAMILTON, April 2 /CNW/ - Stelco Inc. today provided an information\nupdate following the Company's emergence from its Court-supervised\nrestructuring as of midnight at the end of March 31, 2006.\nAs the Company indicated earlier that day, it had satisfied the\nconditions to implementation of its restructuring plan under the Companies'\nCreditors Arrangement Act (\"CCAA\") and the reorganization of its corporate\nstructure under the Canada Business Corporations Act. The transactions\ncontemplated under these plans have been completed.\nThe new Stelco is positioned to establish itself as a viable and\ncompetitive steel producer for the long term. It has a new $600 million asset\nbacked loan facility; a $375 million secured revolving term loan; a low\ninterest loan of $150 million from the Province of Ontario; a plan in place to\npay its pension plan deficiency, and $143,000,000 in new equity through the\nissuance of New Common Shares to Tricap Management Limited, Sunrise Partners\nLimited Partnership, Appaloosa Management L.P., Mr. Rodney Mott (the Company's\nnew president and chief executive officer), and other former creditors that\nelected to receive additional common share equity in lieu of a portion of the\ncash distributions which they otherwise would have received.\nA new board of directors has assumed office. Its members, as announced on\nprevious occasions, are Messrs. Courtney Pratt (Chairman), Dennis Belcher,\nLaurie Bennett, Steve Cohn, Pierre Dupuis, Peter Gordon, John Lacey, Cyrus\nMadon and Tony Molluso.\nUpon the Company's emergence from the CCAA process and the assumption of\noffice by the new board of directors, the resolution appointing Rodney Mott as\nStelco's president and chief executive officer as of April 1, 2006 took\nimmediate effect.\nThe board of directors has authorized a personal investment in the\nCompany by Mr. Mott, who will purchase 1 million New Common Shares of the\nCompany at a purchase price of $5.50 per share, for total proceeds of $5.5\nmillion. The transaction is expected to be completed on Monday, April 3, 2006.\nThe board has also adopted an employee Stock Option Plan subject to\nnecessary approvals. Like similar plans in other companies, it is designed to\nassist in the retention and motivation of key employees. The Plan is also\nintended to assist in the Company's pursuit of ...