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 July 13, 2005 edition
By Naomi Powell
The Hamilton Spectator
(Jul 13, 2005)
Details of Stelco's long-awaited plan
to haul itself out of bankruptcy protection will be released to skeptical
stakeholders Friday.
And the steel giant, which has operated
under creditor protection for 17 months, wants another two months to complete
the plan. "Between now and then we will develop a formal plan for
submission to the court," Stelco CEO Courtney Pratt said yesterday.
The company appears in court July 18 --
the day its current protection expires -- and will ask Justice James Farley to
extend protection to Sept. 9. It will be the eighth extension the company has
requested since granted protection in January 2004.
A similar extension request made by the
company late last month was vigorously opposed by the company's union,
pensioners and salaried workers and turned down by Farley.
"My own personal fear is that this
will drag on forever," said Bill Ferguson, president of the United
Steelworkers' local representing Stelco's Lake Erie employees. "All the
stakeholders have been very patient."
If the extension is granted, Pratt said
Stelco will appear in court Sept. 9 to file a formal restructuring plan and to
seek another extension of its protection. It will also ask for a meeting order,
which would approve procedures for a stakeholder vote on the plan.
Union leaders have already said
Friday's plan will have to match an offer from Brascan-backed Tricap
Management.
That offer, which received the support
of the Ontario government last week, would invest $500 million in the company's
massive $1.5 billion pension deficit, investing an additional $80 million
annually.
"I haven't seen (the company's)
plan and all I can hope is it's equal to or better than the Brascan deal,"
said Ferguson. "I want to get on with this."
Pratt would not reveal the details of
the plan except to say that it was different from a preliminary confidential
plan the company circulated before mediated talks began.
Key elements of that plan included
raising $150 million in new equity, issuing $250 million in eight-year bonds
and selling subsidiaries for about $175 million. All stakeholders were ordered
to use the preliminary plan as a starting point for the talks which collapsed
late last month after mediator George Adams walked away, saying he could not
achieve a consensus.
Pratt said the company has learned a
great deal more about its stakeholders' positions since then and has considered
that.
"It's pretty predictable that
there will be some things they like and some things they don't like given how
divergent everybody's views are," said Pratt.
"What we hope is when we ask them
if this is something viable and achievable, they will say yes."
npowell@thespec.com
905-526-4620