Algoma Steel Announces Final Results of Substantial Issuer Bid
Algoma Steel Group announced the successful completion of its substantial issuer bid, purchasing 41,025,641 common shares at US$9.75 each, totaling approximately US$400 million. This represents 27.9% of outstanding shares. The offer was oversubscribed, with around 60.8 million shares tendered. Algoma will likely restart its normal course issuer bid once these purchases are finalized. Shareholders selling shares under this offer may incur Canadian tax liabilities as deemed dividends. The paid-up capital per share is estimated at C$5.43 (US$4.22).
- Completed repurchase of 41,025,641 shares at US$9.75 each, totaling approximately US$400 million.
- Oversubscribed offering indicates strong shareholder interest.
- Expected to resume normal course issuer bid after share repurchase.
- Shareholders selling shares will be deemed to have received taxable dividends.
- Potential tax implications may discourage some shareholders from partaking in future offerings.
SAULT STE. MARIE, Ontario, Aug. 02, 2022 (GLOBE NEWSWIRE) -- Algoma Steel Group Inc. (NASDAQ, TSX: ASTL) (“Algoma” or the “Corporation”) today announced the final results of its substantial issuer bid (the “Offer”) under which it has purchased for cancellation 41,025,641 of its common shares (“Shares”) at a purchase price of US
Based on the final count by TSX Trust Company, the depositary for the Offer (the “Depositary”), a total of 60,835,820 Shares were properly tendered and not withdrawn. As the Offer was oversubscribed, shareholders who made auction tenders at a price of US
The Corporation expects to be eligible to recommence purchases under its normal course issuer bid after all Shares accepted for purchase under the Offer have been taken up.
To assist shareholders in determining the Canadian tax consequences of the Offer, Algoma estimates that for the purposes of the Income Tax Act (Canada), the paid-up capital per Share is approximately C
The “specified amount” for purposes of subsection 191(4) of the Income Tax Act (Canada) is US
This news release is for informational purposes only and is not intended to and does not constitute an offer to purchase or the solicitation of an offer to sell Shares.
ADVISORY REGARDING FORWARD-LOOKING STATEMENTS - This news release contains forward-looking statements or information (collectively, “forward-looking statements”) within the meaning of applicable securities legislation, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include: timing for payment for the Shares accepted for purchase under the Offer, timing for Shares returned by the Depositary, estimated paid-up capital per Share and the recommencement of the Corporation’s normal course issuer bid, including the benefits and value to the Corporation’s shareholders as a result thereof. Forward-looking statements involve assumptions, risks and uncertainties that may cause such statements not to occur or results to differ materially. These assumptions include: number of Shares properly tendered and not properly withdrawn prior to expiration of the Offer. Risks and uncertainties include: changes in or interpretation of laws or regulations; and other risks and uncertainties as described in the Annual Report on Form 20-F filed by Algoma with the Ontario Securities Commission (the “OSC”) (available under Algoma’s SEDAR profile at www.sedar.com) and with the Securities and Exchange Commission (the “SEC”) (available at www.sec.gov), as well as in the other documents Algoma has filed with the OSC and the SEC. Forward-looking statements speak only as of the date they are made.
Although Algoma believes such forward-looking statements are reasonable, there can be no assurance they will prove to be correct. The above assumptions, risks and uncertainties are not exhaustive. Forward-looking statements are made as of the date hereof and, except as required by law, Algoma undertakes no obligation to update or revise any forward-looking statements.
About Algoma Steel
Based in Sault Ste. Marie, Ontario, Canada, Algoma is a fully integrated producer of hot and cold rolled steel products including sheet and plate. With a current raw steel production capacity of an estimated 2.8 million tons per year, Algoma’s size and diverse capabilities enable it to deliver responsive, customer-driven product solutions straight from the ladle to direct applications in the automotive, construction, energy, defense, and manufacturing sectors. Algoma is a key supplier of steel products to customers in Canada and Midwest USA and is the only producer of plate steel products in Canada. Algoma’s mill is one of the lowest cost producers of hot rolled sheet steel (HRC) in North America owing in part to its state-of-the-art Direct Strip Production Complex (“DSPC”), which is the newest thin slab caster in North America with direct coupling to a basic oxygen furnace (BOF) melt shop.
Algoma has achieved several meaningful improvements over the last several years that are expected to result in enhanced long-term profitability for the business. Algoma has upgraded its DSPC facility and recently installed its No. 2 Ladle Metallurgy Furnace. Additionally, Algoma has cost cutting initiatives underway and is in the process of modernizing its plate mill facilities.
Today Algoma is on a transformation journey, investing in its people and processes, optimizing and modernizing to secure a sustainable future. Our customer focus, growing capability and courage to meet the industry’s challenges head-on position us firmly as your partner in steel.
For more information, please contact:
Mike Moraca Treasurer and Investor Relations Officer Algoma Steel Inc. Phone: 705.945.3300 E-mail: IR@algoma.com |
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