Stelco enters bankruptcy protection

Stelco enters bankruptcy protection

According to recent news in the market, Canadian steel producer Stelco has received an approval to initiate Court-supervised structuring under the scope of Company's Creditor's Arrangement Act (CCAA) in order to prolong its competition in North American steel industry. Bankruptcy protection will also cover subsidiaries of Stelco, except for Altasteel, Norambar (formerly Stelco-McMaster Ltée) and Stelfil. The CEO of Stelco stated that this decision is taken to protect their shareholders, to develop a restructuring plan and to bring solution to the financial problems of the company. With the approval, the company will obtain a legal protection. With the restructuring plans, the company aims to improve productivity, reduce costs and compete in the market. However, in line with the bankruptcy protection, certain layoffs are expected to be on the agenda, as a part of cost reduction plan of the company. The number of workers to be laid off is stated to be around 1500. Total number of workers at two main divisions of Stelco is currently 8400.