U.S. Steel hits 3-year high as Canadian unit seeks credit relief

Wed Sep 17, 2014 11:29am EDT
 
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Sept 17 (Reuters) - Shares of United States Steel Corp rose as much 12 percent to a three-year high a day after the company said its loss-making Canadian arm would apply for relief from creditors and that it would drop plans to expand two of its U.S. facilities.

The company, whose Canadian operations have raked up losses of $2.4 billion over the past five years, said it expects third-quarter results, excluding charges related to its latest moves, to beat Wall Street's estimates.

"These are the boldest steps by U.S. Steel management toward accelerating its transformation into a suitably profitable company," Goldman Sachs analyst Sal Tharani said in a note.

U.S. Steel's shares jumped to a high of $46.54, putting them among the top percentage gainers and the most heavily traded on the New York Stock Exchange.

The company on Tuesday said its Canadian arm would apply for relief from creditors under Canada's Companies' Creditors Arrangement Act.

Shares of Nucor Corp jumped 5.6 percent to a six-year high of $58.76 on Wednesday after the company forecast higher profit for the current quarter.

The stock of Steel Dynamics Inc also hit a six-year high, while that of AK Steel Holding Corp rose 6 percent after the two companies said they completed their separate acquisitions of Russia's Severstal's U.S. units. (Reporting by Sneha Banerjee in Bangalore; Editing by Savio D'Souza)