U.S. Steel Canada launches sale and investment solicitation process

By Caroline Salls

Pittsburgh, Feb. 1 – U.S. Steel Canada Inc. is beginning a sale and investment solicitation process (SISP) under a Jan. 13 order from the Ontario Superior Court of Justice, according to a news release.

Under the initial order, U.S. Steel Canada was authorized to seek all avenues of a sale or refinancing of its business or property, in whole or part.

In addition to its currently operating assets, the company said its assets include idled production equipment, which could be restarted.

According to the release, the SISP is intended to solicit interest in and opportunities for a sale, restructuring or recapitalization of U.S. Steel Canada’s assets and business operations. Opportunities may include one or more of a restructuring, recapitalization or other form of reorganization of the company’s business and affairs as a going concern, or a sale of all, substantially all, or one or more components of its assets and business operations.

The company said the SISP will consist of two phases. In phase one, parties who have entered into a non-disclosure agreement will receive information considered relevant to the opportunity and have the opportunity to submit a non-binding letter of interest by 5 p.m. ET on Feb. 29 to acquire all or substantially all of the company’s property or make an investment in, restructure, reorganize or refinance the business.

Parties that have submitted qualified letters of interest, have a bona fide interest in completing a sale proposal or investment proposal and have the financial capability to close a transaction may be invited to participate in phase two of the SISP, which will include detailed due diligence and access to a confidential data room.

The assets and business operations include real property located on Hamilton Harbour in Hamilton, Ont.; coke ovens, assets used for ironmaking, steelmaking and finishing and other operating assets and business operations located in Hamilton, Ont.; and real property located in Nanticoke, Ont., coke ovens, assets used for ironmaking and steelmaking, hot-rolling, pickling and other operating assets and business operations located in Nanticoke, Ont.

Ernst & Young Inc. is U.S. Steel Canada’s court-appointed monitor, and Rothschild Inc. is the company’s financial adviser.

Hamilton, Ont.-based U.S. Steel Canada’s operations are located at Lake Erie Works, a fully integrated steelmaking facility, and at Hamilton Works, a cokemaking and finishing facility.

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