Touchstone Exploration Inc. press release
Stelco moves forward with restructuring plan
TSX - Toronto Stock Exchange · Oil · Natural Gas · Natural Gas Liquids · Canada
HAMILTON, ON, Sept. 23 /CNW/ - Stelco Inc. (TSX:STE) announced this evening that it has satisfied the preliminary conditions under the restructuring agreement entered into between the Company and the Province of Ontario earlier this week. Courtney Pratt, Stelco President and Chief Executive Officer, said, "This marks a truly significant step in our restructuring process. It satisfies the preliminary conditions under our agreement with the Province of Ontario. And it maintains the positive momentum towards a successful restructuring."
Memorandum of Agreement: Stelco has entered into a Memorandum of Agreement with each of USW Locals 8782 (Lake Erie) and 5220 (AltaSteel in Edmonton). The Company will refrain from public discussion of the agreements' details until the Locals have informed their respective members. Ratification of the agreements will provide the Company with collective agreements governing the two facilities. Mr. Pratt said, "The agreements will provide welcome certainty and stability for the Company, our employees and customers, and the communities in which we operate. I want to acknowledge the outstanding efforts of all those involved in achieving these important and responsible agreements."
Financing facilities: Stelco also announced this evening that it has reached agreement with Tricap Management Limited ("Tricap") for the provision of two financing facilities, subject to Court approval. The first financing facility consists of the provision by Tricap to Stelco of a $350 million bridge facility in the form of a Secured Revolving Term Loan. The second facility is a Standby Agreement under which Tricap will backstop a $75 million rights offering of new Secured Convertible Notes to be issued by Stelco. Tricap will also receive an option to purchase $25 million of the same Notes that will be exercised by Tricap under certain conditions.
Corporate issues agreement: The original conditions under the restructuring agreement had also called for the entering into of a corporate issues agreement between the Company and the USW relating to certain Stelco governance issues. The parties subsequently agreed not to pursue such an agreement.
Stay extension: The Company also announced that the Court has extended the stay period until October 4, 2005.
About Stelco Stelco Inc. is a large, diversified steel producer. Stelco is involved in major segments of the steel industry through its integrated steel business, mini-mills, and manufactured products businesses. This news release may contain forward-looking information with respect to the Corporation's business operations, financial performance and conditions. Actual results may differ from expected results for a variety of reasons including factors discussed in the Corporation's Management's Discussion and Analysis section of the Corporation's 2004 Annual Report. To learn more about Stelco and its businesses, please refer to our Web site at www.stelco.ca.
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