TORONTO The United
Steelworkers union might look to gain seats on the board of
Essar Steel Algoma Inc. should Indias Essar Group decide
to take its North American operations public, a union official
The USW "years ago" bargained to
have the option to name three members to the board of the Sault
Ste. Marie, Ontario, steelmaker, union area coordinator Jack
Ostroski said. But when the company was taken private, the USW
"saw it better legally not to have members" on the board.
"If they went public again,
wed probably put our members back on," Ostroski told
AMM. He said that would most likely be the only major
impact on the union of any initial public offering (IPO).
Talk of an IPO for Essars
North American operationsEssar Steel Algoma Inc. and
Essar Steel Minnesota LLCwas reported late last month by
The Times of India, which cited anonymous sources
familiar with the matter.
Ostroski speculated that Essar
might be looking to finance its operations in Minnesota.
"Theyre trying to raise capital or theyre trying to
pay down debt. Those are the two reasons (for an IPO). With the
Minnesota mill coming online, I would assume thats where
most of the debt is," he said.
The company declined to either
confirm or deny rumors of an IPO. "As is prudent, we regularly
evaluate strategic options for the business. Comment at this
time would be purely speculative," an Essar Steel Algoma
spokesman told AMM in an e-mail.
Mumbai-based Essar Global Ltd.
in 2007 reached a $1.7-billion deal to acquire Algoma Steel
Inc. of Sault Ste. Marie, Ontario, and another deal to acquire
the assets of Minnesota Steel Industries LLC, St. Paul, Minn.
(AMM, May 31, 2007).
Essar Steel Minnesota is
planning to build an open-pit taconite mine, a concentrator and
a pellet plant in Nashwauk that are scheduled to come online by
the end of 2012.
Plans call for the pellet plant
to have a production capacity of some 7 million tonnes per
year, a portion of which will go to supply sister company Essar
Steel Algoma. Essar Steel Algoma is expected to sell its
surplus ore on the open market in North America (AMM,