Looks like the restructuring plan for Stelco has been approved in principle with all stakeholders. Nothing for existing shareholders, so that was a bust. HOWEVER, even with everyone on board, Stelco is going to have a hard time making money when it comes out of bankruptcy in Jan 2006. We'll look at Stelco at the end of Q2 2006, to see if the new and improved Stelco is worth hedging for the last half of the year. Stay tuned. I figured that the governments would kick in $100 million to seal the plan - they ponied up $80 million...pretty good guess.
Note - the pension contribution holiday ends after 6 months after restructuring...so, look for charges of $30-$35 million against each of the Q3 & Q4 next year. We need to see the IPO of the new shares in Jan before we can crunch the numbers. Remember also, that GM just renewed the contract with Stelco, BEFORE it announced the plant closures.
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment