The Stel Salaried Pensioners Organization wishes to
thank The Hamilton Spectator for permission to post the following article by
Reporter Naomi Powell published in the June 28, 2005 edition
By Naomi
Powell
The Hamilton Spectator
(Jun 28, 2005)
A judge granted Stelco an extra 10 days
of bankruptcy protection yesterday, ordering stakeholders to "take an
extremely cold shower" before returning to the bargaining table.
"You may not like each other for
various reasons, but as they say, if you don't all hang together you'll hang
separately," Justice James Farley told a courtroom packed with Stelco
executives, union leaders and employees. "A mutual problem requires a
mutual solution."
Official talks between stakeholders
collapsed on Friday after mediator George Adams resigned. In a letter to
stakeholders, Adams said the union, company and other key players could not
agree on a plan to restructure the steelmaker.
Talks are not to resume until July 4,
"enough time to take an extremely cold shower and reflect," Farley
said. The stakeholders will then resume talks for two weeks before providing a
progress report to the court on July 18 - 10 days after Stelco's original
deadline of July 8.
The extension is far shorter than the
two and a half months company officials requested and marks a rare instance in
which Farley -- who has been overseeing Stelco's restructuring efforts for 17
months -- did not accept the recommendation of the court-appointed monitor, who
backed the company's request.
The decision also suggests the start of
a new level of court involvement in the Stelco saga, analysts say.
"At this stage if there's still a
logjam when they come back, it will become apparent that the only party left to
break it is the court," said Bruce Leonard, president of the Insolvency
Institute of Canada. "The next move belongs to (Farley)."
Union leaders rallied hard against any
extension yesterday, arguing that a postponement would stall the momentum built
up over the past month.
"We've been at this process for 17
months, we don't need a cooling off period," said Ken Rosenberg, lawyer
for the United Steelworkers of America. "We need to be put in a room and
that door has to be locked."
The union issued a terse press release
last night, stating that it had "lost its patience with the process."
About 1,000 workers at Stelco's Lake
Erie plant have been without a contract since last summer and could strike.
Several hundred workers at Stelco's Stelwire operations will see their contract
expire on July 31.
Stelco has struggled to find a plan to
restructure its operations since it gained bankruptcy protection in January
2004. The biggest obstacle to talks has been differences between the union,
which wants a solution for Stelco's $1.3-billion pension deficit and the
bondholders, who want to be paid out by the company. A number of bids to take
over the steelmaker were initially courted and then rejected by the company,
which chose to seek financing for its own plan on the capital markets.
Farley also heard arguments from
Georgian Windpower Corp., yesterday, which wants Stelco's bankruptcy protection
lifted so it can launch a $350-million lawsuit against the steelmaker over a
failed agreement to build wind turbines.
Stelco is protected from legal action
while under court supervision.
npowell@thespec.com
905-526-4620