Stelco Announces Closing of Secondary Offering and Underwriter's Exercise of Over-Allotment Option
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HAMILTON, ON, June 2, 2021 /CNW/ - Stelco Holdings Inc. ("Stelco" or the "Company") (TSX: STLC) announced today that the previously announced bought deal secondary offering (the "Offering") of 6,670,000 common shares of the Company (the "Common Shares") by LG Bedrock Holdings LP (the "Selling Shareholder") at a price of $33.00 per Common Share for aggregate gross proceeds of $220,110,000 to the Selling Shareholder has closed (which included the sale of 870,000 Common Shares pursuant to the exercise in full by the underwriter of its over-allotment option (the "Over-Allotment Option")).
The Offering was completed by way of a prospectus supplement dated May 28, 2021 (the "Prospectus Supplement") to the final base shelf prospectus of the Company dated February 11, 2021 (the "Base Shelf Prospectus"). The Base Shelf Prospectus and the Prospectus Supplement have been filed with Canadian securities regulators and are available under the Company's profile at www.sedar.com.
The Offering was led by BMO Capital Markets. All net proceeds of the Offering, after deducting the underwriting commission, were paid to the Selling Shareholder.
Prior to the Offering, Bedrock Industries Coöperatief U.A. ("Bedrock Industries") held 34,172,315 Common Shares, representing 38.5% of the issued and outstanding Common Shares. Immediately following the commencement of the Offering, Bedrock Industries authorized a distribution in kind of all of its Common Shares, including the Common Shares sold in the Offering, indirectly to the Selling Shareholder and to Alan Kestenbaum (or entities beneficially owned by, or under the control or direction of, or other family members not under the control of Alan Kestenbaum) (the "Pre-Closing Share Transfers"). Following the completion of the Pre-Closing Share Transfers, but prior to the closing of the Offering, the Selling Shareholder held 25,752,236 Common Shares, representing approximately 29.0% of the issued and outstanding Common Shares, and, following the closing of the Offering, the Selling Shareholder holds 19,082,236 Common Shares, representing approximately 21.5% of the issued and outstanding Common Shares. Following the completion of the Pre-Closing Share Transfers and the closing of the Offering, Alan Kestenbaum (or entities beneficially owned by, or under the control or direction of, or other family members not under the control of Alan Kestenbaum) holds 10,708,279 Common Shares, representing approximately 12.1% of the issued and outstanding Common Shares (of which Alan Kestenbaum, directly or indirectly, beneficially owns, or has control or direction over, 8,670,330 Common Shares, representing approximately 9.8% of the issued and outstanding Common Shares). The net proceeds of the Offering, after deducting the underwriting commission, were paid to the Selling Shareholder. The Company did not receive any proceeds from the Offering or the exercise of the Over-Allotment Option. Alan Kestenbaum, the Executive Chairman and CEO of the Company, was not a selling shareholder and did not receive any proceeds from the Offering or from the exercise of the Over-Allotment Option.
The Common Shares have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.
About Stelco
Stelco is a low cost, integrated and independent steelmaker with one of the newest and most technologically advanced integrated steelmaking facilities in North America. In addition to being North America's only integrated producer of pig iron, Stelco produces flat-rolled value-added steels, including premium-quality coated, cold-rolled and hot-rolled steel products. With first-rate gauge, crown, and shape control, as well as reliable uniformity of mechanical properties, our steel products are supplied to customers in the construction, automotive and energy industries across Canada and the United States as well as to a variety of steel service centres, which are regional distributors of steel products. At Stelco, we understand the importance of our business reflecting the communities we serve and are committed to diversity and inclusion as a core part of our workplace culture, in part, through active participation in the BlackNorth Initiative.
About the Selling Shareholder
The Selling Shareholder is organized under the laws of the State of Delaware and the address of its registered office is 1209 Orange Street, Wilmington, DE 19801, United States. The Common Shares were disposed of by the Selling Shareholder as a result of investment considerations including price, market conditions, availability of funds, evaluation of alternative investments and other factors. An early warning report relating to the transaction contemplated hereby will be filed by the Selling Shareholder in accordance with applicable securities laws and will be available on SEDAR under Stelco's profile at www.sedar.com or may be obtained directly from James C. Pickel, Jr. upon request at (212) 651-1148.
SOURCE Stelco
For investor enquiries: Paul D. Scherzer, Chief Financial Officer, (905) 577-4432, [email protected]; For media enquiries: Trevor Harris, Vice-President, Corporate Affairs, (905) 577-4447, [email protected]
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