The Stel Salaried Pensioners Organization wishes to thank The Hamilton Spectator for permission to post the following article published in the October 6, 2004 edition

Oct. 6, 2004. 12:33 AM

Stelco plans sale of three more assets to raise cash

Stelco Inc. plans to sell three additional assets, including its AltaSteel subsidiary near Edmonton, in an attempt raise more capital as the steelmaker restructures.

Stelco disclosed late yesterday that it will pursue the sale of AltaSteel as well as the Montreal area's Norambar -- formerly known as Stelco-McMaster -- and its 40 per cent interest in Camrose Pipe Co.

Stelco, which has been operating under bankruptcy protection since late January, has already announced plans to seek buyers for its Stelfil, Stelpipe and Stelwire businesses.

AltaSteel and Norambar were not included as part of Stelco's insolvency claim in January, when it entered creditor protection under the Companies' Creditors Arrangement Act.

In a statement yesterday, Stelco CEO Courtney Pratt said the moves to sell more businesses -- confirming speculation that had been circulating among some industry observers -- reflects further efforts to sell off non-core operations so Stelco can concentrate on its main steelmaking business based in Hamilton and Nanticoke, Ont.

"We've indicated in the past that we would sell assets outside the integrated steel business that will be the focus of the new Stelco," Pratt said.

Stelco said it will seek the court's approval for the sales as part of seeking court approval for a broader capital raising process on Oct. 19. The company wants the judge overseeing its restructuring to allow it to begin a process to raise several hundred million dollars in financing to mill upgrades and other capital expenditure projects.

"The objective of this process is to raise new capital for the business and its planned capital expenditure program," Pratt said. "That capital expenditure program will significantly strengthen the competitive cost base of the company. It is a critical step in ensuring Stelco's future viability."

AltaSteel is located in Strathcona County near Edmonton. Canada's first steel minimill, it purchases steel scrap and melts and rolls it into new steel products for the mining, manufacturing and construction industries. It had 368 employees at the beginning of 2004.

Stelco had been looking to sell non-core assets such as AltaSteel in the months leading up to its insolvency claim -- one potential sale fell through -- but plans to sell the operation were put on hold pending further review under its court-supervised restructuring.

AltaSteel also owns a 50 per cent interest in a metals recycler, GenAlta Recycling Inc., and a 50 per cent interest in a grinding ball manufacturer, MOLY-COP Canada.