Stelco Holdings Inc. has priced its proposed initial public offering (IPO). The company will issue of 11,765,000 common shares at an offering price of $17.00 per share to raise gross proceeds of $200,005,000.
The offering is being made through a syndicate of underwriters led by Goldman Sachs Canada Inc. and BMO Capital Markets and includes Credit Suisse Securities (Canada), Inc., J.P. Morgan, Scotiabank, TD Securities Inc., National Bank Financial Inc., and Oppenheimer & Co. Inc.
Stelco has granted to the underwriters an over-allotment option for additional 1,764,750 shares at the offering price for additional gross proceeds of up to $30,000,750 if the over-allotment option is exercised in full.
McCarthy Tétrault LLP and Torys LLP acted as legal counsel to Stelco and the underwriters respectively in connection with the offering.
Stelco will commence trading on the Toronto Stock Exchange (TSX) on November 3, 2017 under the symbol “STLC”. The closing of the offering is expected to occur on or about November 10, 2017.
Bedrock Industries B.V. owns 75,283,887 Stelco shares, being 100% of outstanding share prior the closing of the IPO.
Bedrock Industries B.V. is wholly owned by Bedrock Industries L.P. with LG Bedrock Holdings LP, and AK Bedrock, LLC, a Delaware limited liability company wholly owned by Alan Kestenbaum as its principal limited partnership. LG Bedrock Holdings, AK Bedrock, David Cheney are entitled to 70.75%, 26.75% and 2.5% of the Bedrock Industries proceeds. LG Bedrock Holdings is ultimately controlled by Lindsay Goldberg, LLC.
Stelco began as The Steel Company of Canada, Limited in 1910. In 2004, Stelco Inc. filed for creditor protection under the Companies’ Creditors Arrangement Act (CCAA). Stelco Inc. subsequently emerged from CCAA as a going concern on March 31, 2006. In October 2007, Stelco Inc. was acquired by United States Steel Corporation (USS) for an enterprise value of approximately US $2.0 billion and changed its name to U. S. Steel Canada Inc. (USSC). USSC sought CCAA protection in September 2014.
USSC reached an agreement with Bedrock Industries L.P. on December 9, 2016, whereby Bedrock would acquire all of the outstanding shares of USSC. Upon closing of the acquisition by Bedrock on June 30, 2017, USSC exited CCAA protection and changed its name back to Stelco Inc.
photo credit: Stelco