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.