Stelco completes its inventory monetization arrangement

Stelco completed inventory monetization arrangement. Under the terms of the arrangement, Stelco agreed to transfer certain of its raw material inventory, including coal and iron ore to a third party in consideration for net proceeds of approximately $100-million. Under the terms of the arrangement, Stelco is required to post a cash collateral margin to its counterparty and agreed to purchase the raw materials inventory from the counterparty, at an agreed upon pricing formula, as needed for its steel manufacturing processes and upon expiry of the term of the arrangement.

It is anticipated that the proceeds of the inventory monetization arrangement will be used to repay the outstanding advances drawn under Stelco’s asset-based credit facility and for general working capital purposes.

 

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