Published reports in Hamilton indicate the Indian owners of Essar Steel Algoma in Sault Ste. Marie are involved in a bidding process to purchase the bankrupt Canadian assets of U.S. Steel, formerly known as Stelco.
The newspaper quoted an anonymous source as saying Essar is only the steel producer to make a bid for both Ontario steel mills in Hamilton and Nanticoke, now under creditor protection.
The other bidders seek individual pieces, including the waterfront property in Hamilton.
Stelco was under creditor protection when U.S. Steel bought the company in 2007, but promises of making major capital investments within three years were broken with a year.
That same year Essar purchased Algoma Steel for $1.85 billion, with the corporate structure changing from a publicly-traded company into a private asset of Mumbai, India’s Essar Global.
The Sault steel producer is undertaking a $240-million expansion and modernization program, supplemented by $60 million in federal and provincial subsidies.
Essar is also construction a $1.9 billion iron ore mine and pellet plant in Nashwauk, Minn., which is heavily subsidized with state funds.
This is not the Sault steel maker’s first dalliance with Hamilton steel assets.
From 1988 to 1991 Algoma was briefly owned by Dofasco (now a subsidiary of ArcelorMittal) until the Dofasco bailed during a strike.
In the early 2000s, a profitable Algoma, under the leadership of CEO Denis Turcotte, considered purchasing bankrupt Stelco and combining them into one operation.
