The Stel Salaried
Pensioners Organization wishes to thank The Hamilton Spectator for permission
to post the following article by Reporter Steve Arnold published in the April
7, 2005 edition
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Apr. 7, 2005. 12:42 AM |
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Stelco retirees take fight back to
top court |
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By Steve Arnold |
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Stelco retirees are asking the Supreme Court of Canada to overturn, again, the controversial appointment of two shareholder representatives to the struggling company's board of directors. The latest appeal by the salaried retirees group marks the third time a court has been asked to rule on the appointments of Roland Keiper and Michael Woollcombe to the board. Last month, they were stripped of their positions by bankruptcy court Justice James Farley and restored by the Ontario Court of Appeal. While waiting for the country's top court to rule on their application for leave to appeal, the retirees will go back to the Ontario Court of Appeal today asking for a freeze on the order restoring the men to the board. In their motion, the retirees repeat their basic argument that giving shareholders two seats on the board and its critical restructuring committee is unfair to all the other groups which depend on Stelco. As shareholders, the retirees argue, Keiper and Woollcombe are only interested in boosting the value of their stock, not in the long-term future of Stelco. "Stelco is insolvent. Its share price is entirely speculative. The denial of a stay would threaten the successful restructuring of Stelco and promote an ineffective, short-term restructuring and set the stage for collapse in the future that could well be bankruptcy liquidation," the motion says. "Keiper and Woollcombe are financially motivated to boost share prices for the short term and not promote a long-term restructuring of Stelco ... There are serious problems at Stelco that Keiper and Woollcombe by definition have no long-term interest in solving." Between them Keiper and Woollcombe and their companies Clearwater Capital Management Inc. and Equilibrium Capital Management Inc. control about 20 per cent of Stelco's outstanding Class A shares. Their appointments to the board were backed by another 21 per cent of shares, held mainly by large institutional investors. Stelco said last night it would oppose the retirees' motion on the grounds it's in the company's best interest for the men to stay on the board and that the restructuring could be finished in the time needed for the Supreme Court to rule on an application for leave to appeal. It also repeated arguments that the legal requirement for directors to act in the best interest of the company provides retirees with enough protection. sarnold@thespec.com 905-526-3496 |