Council to Discuss Fate of Steel Plant

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City Council has said they will be holding a special Council meeting on Monday August 20th at 4:30pm.

The purpose? To discuss Algoma’s Companies’ Creditors Agreement Act Proceedings.

Earlier this week, councillors met privately for a briefing on how the plant intends to address their municipal tax obligations. Since last October, Algoma has been paying $500,000 a month to the city. But it remains almost $25 million in debt, including $14 million in taxes originally payable at the time Algoma entered insolvency protection in November 2015.

Superior Court Justice Glenn Hainey will be asked to approve the sale of nearly all assets of Essar Steel Algoma Inc. to a British Columbia-registered company associated with Algoma’s term lenders and consenting senior secured noteholders. A target date of Sept. 30 has been set to close the transaction, which covers worker pensions, city taxes, the co-generation plant, port and lenders who’ve kept Algoma afloat since it applied for protection against its creditors in November 2015.

The sale is dependent on a few tentatively agreed to items that need final approval. Those items include agreements on unpaid taxes to the City of Sault Ste. Marie, special regulations to comply with Ontario’s Pension Benefits Act, new collective agreements with unionized members, and an exemption from preexisting environmental liabilities at the plant. The deal is expected to reduce Algoma’s debt from $1.2 billion USD to $300 million USD.

Stay tuned for the outcome of the special council meeting.

 

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Riley Smith
Riley Smith is an enthusiastic and versatile critical thinker who has been with SaultOnline since January 2018. She holds a double Honours Degree in History and Political Science from Algoma University, and a Postgraduate Certificate in Public Relations and Event Management from Sault College. She is Google Marketing Fundamentals certified, and is also working towards a Certificate in Diversity and Intercultural Relations. When she's not reporting, you can find her MC'ing the Soo Greyhound home hockey games, spending time with her basset hound, Douggie, or seeing the world one breathtaking view at a time.

4 COMMENTS

  1. We as loyal tax paying citizens have the right to know who owns the numbered company. That steel mill has sucked enough money out of our pockets and our increasingly high property taxes prove just that. Really too bad this is a one horse town for industry. Really too bad that the downtown management club prevented the once a dream Honda Plant from coming here. Now we are all paying the consequences….

  2. Stop allowing Foreign People to buy our businesses run them down to foreclosure and leave our City without taxes because I as a widow cannot afford to have my taxes keep going up to make up for them not paying their taxes!!!

  3. The $64 question. Who owns the numbered company?
    Why is it such a big secret? Is Essar involved in ANY way??
    I sure hope not or it will be doomed once again.

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