Insolvent Essar Steel Algoma accepts bid for assets
Value of KPS’s joint bid with several lenders not disclosed.
SAULT STE MARIE, Ont. — Essar Steel Algoma says it has agreed to a joint bid for its assets by a consortium of bidders formed by New York-based KPS Capital Partners LP and a number of its term lenders.
The value of the bid by KPS and the insolvent steelmaker’s pre-petition term lenders was not disclosed.
Essar Steel Algoma, based in Sault Ste. Marie, Ont., filed for creditor protection under the Companies Creditors Arrangement Act (CCAA) in November. Pre-petition liabilities are those that arise prior to a company seeking court protection from creditors.
The company said it served a motion June 17 with the Ontario Superior Court of Justice asking for the deal to be approved.
The consortium bid includes a cash consideration, a credit bid equivalent to the term loan and the assumption of certain liabilities.
In addition to the court approval process and customary regulatory approvals, closing the transaction is subject to a number of conditions relating to employee and benefit matters, including pension plans and collective agreements, capital projects and environmental matters.News from © Canadian Press Enterprises Inc. 2016