Stelco granted stay extension, ordered to take cooling off period following failed mediation

By Caroline Salls

Pittsburgh, June 27 - Stelco Inc. was granted an extension to the stay period under its court-supervised restructuring to July 18 from July 8, according to a company news release.

In addition to granting the extension, the Ontario Superior Court of Justice ordered the parties to take a one week "cooling off" period until July 4 to reflect on the recent mediation conducted by George Adams and to consider the alternatives for Stelco as a going concern.

Stelco announced Friday that the mediation had ended without an agreement being reached and Adams had resigned

After this week, the parties will participate in dialogue and a progress report is to be provided to the court by July 18, at which time another stay extension may be requested.

"This extension will enable the company to continue proceeding in such matters as conducting discussions with stakeholders, completing the claims procedure and proposing a restructuring plan based on discussions with stakeholders," president and chief executive officer Courtney Pratt said in the release.

In coming days, Pratt said the company will examine the proposals that could form the basis of a restructuring plan and look for a solution that is in the interests of all stakeholders, not just one or more groups.

Pratt said Stelco seeks to emerge from Companies' Creditors Arrangement Act bankruptcy as a "viable and competitive steel producer" as quickly as possible.

"This process will include continuing our work to resolve the pension funding issue and pursuing a fair and reasonable collective agreement with USWA Local 8782 at Lake Erie," Pratt said in the release.

Pratt added that the softening of steel market conditions and the significant drop in steel prices prompted the company's sense of urgency in the restructuring process.

"As recently as last week the court-appointed monitor wrote that Stelco's future financial results will be highly dependent on the direction of our volatile input costs and the strength of North American steel markets," Pratt added in the release.

The Hamilton, Ont., steelmaker filed for bankruptcy on Jan. 29, 2004 under the Companies' Creditors Arrangement Act.

© 2015 Prospect News.
All content on this website is protected by copyright law in the U.S. and elsewhere. For the use of the person downloading only.
Redistribution and copying are prohibited by law without written permission in advance from Prospect News.
Redistribution or copying includes e-mailing, printing multiple copies or any other form of reproduction.