Steel Mills

Algoma Shares Begin Trading, IPO Proceeds Toward EAF

October 20, 2021

Algoma Steel shares began trading on the Nasdaq Stock Exchange and the Toronto Stock Exchange (TSX) on Wednesday under the ticker symbol “ASTL.”

The development follows an initial public offering (IPO) made possible by a merger between the Canadian flat-rolled steelmaker and New York-based Legato, a special purpose acquisition company (SPAC).

Algoma

The deal resulted in proceeds of approximately $306 million flowing into Algoma’s coffers, according to a press release.

The Sault Ste. Marie, Ontario-based sheet and plate producer will use the money for strategic investments, including its proposed shift from integrated steelmaking to electric arc furnace (EAF) production.

“We are thrilled to complete our business combination with Legato and return Algoma to the public market,” Algoma CEO Michael McQuade said in a statement.

“We are investing in our people and processes, and optimizing our operations to embrace a more sustainable future,” he added.

Algoma has already upgraded its cornerstone direct strip production complex, built a second ladle metallurgy furnace and is under way with an “extensive” upgrade to its plate mill – the only discrete plate and heat-treating facility in Canada, McQuade said.

A shift to EAF steelmaking would allow Algoma to increase its production capacity while also reducing carbon emissions by more than 70%, he said.

Algoma makes hot-rolled coil, cold-rolled coil and plate for a range of end markets including automotive, construction, energy and defense, according to the company’s website.

The company currently has two blast furnaces: The No. 7 has daily capacity of 8,400 tons of iron. The No. 6 has capacity of 3,000 tons of iron per day but is idle, according to SMU’s blast furnace status table.

By Michael Cowden, Michael@SteelMarketUpdate.com

Michael Cowden

Michael Cowden is managing editor for Steel Market Update. Cowden has covered the steel industry since 2007. He specializes in flat-rolled steel but has also reported on steel long products, steel pipe and tube, and aluminum. Before joining SMU, Cowden held reporting jobs at Fastmarkets AMM in Chicago, the Associated Press in Pittsburgh, and the Cambodia Daily in Phnom Penh. He has also worked as a copy editor and in marketing at the University of Chicago Press. Cowden has a BA in English from the University of Chicago and an MSJ journalism from Northwestern University’s Medill School of Journalism. Contact him at michael@steelmarketupdate.com or 724-759-7872.