UPDATE 2-Ontario Steel in bid for US Steel Canada, including C$1 bln liabilities

Tue Aug 9, 2016 11:47am EDT
 
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* Would assume C$954 million pension liabilities

* Has also submitted offer for Essar Steel Algoma

* Could combine both businesses if successful (Adds details of progress on Essar Steel Algoma bid, background)

By Matt Scuffham

TORONTO, Aug 9 (Reuters) - Ontario Steel Investment Ltd, a group that includes shareholders of Essar Global, said on Tuesday it has submitted an offer to purchase U.S. Steel Canada, which has been in creditor protection since 2014.

The offer includes the assumption of C$954 million ($725 million) in liabilities under U.S. Steel Canada's pension plan and a commitment to provide C$25 million toward post-employment benefits for U.S. Steel Canada's past and present staff.

U.S. Steel Canada, which employs nearly 2,000 workers in Ontario and has the capability to produce 2.6 million tons of steel annually, is a former unit of United States Steel Corp .

The United Steelworkers (USW) union had criticized U.S. Steel for its decision to eliminate Essar Global, an Indian energy and resources conglomerate, as a potential buyer of U.S. Steel Canada's operations in Hamilton and Nanticoke, Ontario.

Ontario Steel said it remained in active discussions with the USW regarding its offer and looked forward to continuing discussions with the province of Ontario.   Continued...