Steel Mills

Essar Steel and US Steel Likely Top Bidders for US Steel Canada

August 13, 2015

Essar Steel is in the running for purchase US Steel Canada according to an anonymous source close to the bidding process.

According to the Hamilton Spectator, the source said Essar Steel Holdings is interested in purchasing both Hamilton Works and Lake Erie Works, the only bidder interested in the entire USSC operation. Other bidders are seeking the bayfront land or portions of the steel mill. Essar’s bid is thought to be in the range of $400 million.

Purchase of the mills would complement Essar’s current holding, Essar Steel Algoma, which is undergoing a $240 million expansion and modernization program.

Other bidders include parent company US Steel and the Hamilton Port Authority. Other rumors claim that the coke ovens at USSC are of interest to ArcelorMittal Dofasco. The main contenders for the US Steel Canada assets, however, are thought to be US Steel and Essar Steel.

None of the rumored bidders will comment on their interest in the Canadian assets. It is known through the court monitor reports that binding bids were submitted by July 24 and are now being reviewed before recommendations are made to the court.

Hamilton Port Authority spokesperson Larissa Fenn said that the USSC property was a “positive opportunity” for a “range of modern, sustainable industrial uses.”

Reviving steelmaking at Hamilton would be a “dream outcome” said Coun. Sam Merilla, vice-chair of the city’s steel issues subcommittee.

USW workers would welcome a bidding competitor for US Steel. Union and provincial officials worry that the $2.2 billion US Steel claims to be owed by US Steel Canada would drain any available cash that could be used to bolster US Steel Canada’s underfunded pension plans.