Steel Mills

Algoma Lenders Make Deal on Taxes with City

August 16, 2017

Lenders pursuing the purchase of Canadian steel mill Algoma have reached an agreement with the City of Sault Ste. Marie regarding payment of Algoma’s back taxes.

We have settled the tax issue,” Mayor Christian Provenzano told The Sault Star. “We are satisfied that we recovered enough moneys in our negotiations to ensure that we were very fair to the taxpayers of the City of Sault Ste. Marie and that they’re protected. We won’t have to pass on any tax increases or service cuts as a result of this issue.”

Algoma owes approximately $20 million to the city resulting from a suspension of payments during the company’s restructuring under the Companies Creditors’ Arrangement Act. In May, Justice Frank Newbould ordered Algoma to resume payments in the amount of $350,000 per month for city taxes. Under the agreement reached with the DIP lenders, that amount will increase to $500,000 in August providing the acquisition by the lenders is concluded successfully.

Mining land for sale

Algoma has also posted for sale 10 potential mining sites it owns in Northern Ontario. The sites have not been explored for over 40 years, according to the Algoma listing. The sites were originally acquired for potential iron ore mining and may contain jasper, magnetite, pyrite, siderite and gold.