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GLOBALIZATION -
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Last Canadian steel company left reportedly up for sale; CAE boss, Bombardier CEO warn against foreign takeovers & Canadian dollar to hit parity with US dollar by year's end

Posted in the database on Monday, August 06th, 2007 @ 19:42:03 MST (8987 views)
by Jim Scott    Salt Spring News  

Untitled Document Switching to a service-led economy with a volatile resource base would be "lengthy and hazardous." - CAE Inc. chief executive Robert Brown

Shares of Stelco hit a 52-week high of $35.90 in April amid a wave of industry consolidation. Photo: CBC

Stelco rumoured to be up for sale
CBC News Canada June 1, 2007

Amid a wave of takeovers in the Canadian steel industry comes word that Stelco Inc., the last domestically owned producer, is up for sale. ... In recent months, Algoma Steel Inc. agreed to be taken over by India's Essar Global Ltd., in a deal worth $1.86 billion, and Ipsco Inc. agreed to be acquired by Sweden's SSAB Svenskt Stal AB in a $8.5-billion deal. Dofasco was acquired in 2006 by Arcelor, which was then taken over by Mittal Steel. ... Shares of Stelco hit a 52-week high of $35.90 in April amid the wave of consolidation. The stock closed Thursday at $26.90, making Stelco's overall market capitalization almost $730 million. Steclo emerged from creditor protection at the end of March 2006 after a 26-month restructuring.

Stelco could be next steel company in play: Report
CanWest News Service/Financial Post Canada June 1, 2007

Stelco Inc. could be the next big Canadian steel company on the auction block, a media report out Friday morning suggests. Shareholders who own more than half of Stelco are expressing interest in cashing out of the company in the midst of a massive restructuring of the steel industry and strong commodity prices, the report says. Toronto's Brookfield Asset Management Inc., which runs a restructuring fund that is Stelco's largest shareholder at about 36 per cent, and Appaloosa Management, a U.S. hedge fund that owns 18 per cent, have suggested they are ready to sell at a premium to the current market price for Stelco stock, the Globe and Mail reported. Analysts suggested Friday morning that it could be a good time for such investors to plan an exit in advance of a possible downturn in high-flying markets.

Related: CAE boss warns against foreign takeovers
Robert Gibbens CanWest News Service/Financial Post Canada June 1, 2007

MONTREAL - CAE Inc. chief executive Robert Brown said Thursday Canadians can't risk a "laissez-faire" attitude toward the surge of foreign takeovers of big Canadian corporations because of the serious impact it could have on the economy. "A country must be in charge of its own destiny and can't have key decisions made outside," he said in an analysts' conference call. "That means retaining large head offices and the top-quality jobs they provide." CAE, founded in Montreal 50 years ago, is the world leader in flight simulation and pilot training with fiscal 2007 revenue of $1.25 billion. CAE developed all its technology here and Brown returned the headquarters to Montreal from Toronto. ... Earlier this week, Bombardier CEO Laurent Beaudoin called for federal intervention into foreign takeovers while the federal Liberal Opposition called for a moratorium on them until Ottawa sets new rules. The loss of head offices from the takeovers of Inco by Brazil's CVRD and of Falconbridge by European metals giant Xstrata, along with the threat of foreign control of Alcan and BCE, implies more decline in Canada's backbone manufacturing sector, he said. But switching to a service-led economy with a volatile resource base would be "lengthy and hazardous." ...

Canada dlr to hit parity with USD by end '07-CIBC
Reuters UK June 1, 2007

The Canadian dollar will reach parity with the U.S. currency by the end of 2007 with the help of high commodity prices, ongoing merger-related interest and higher interest rates, CIBC World Markets said on Friday. CIBC said the Canadian dollar, which was last at par with the U.S. dollar in November 1976, will maintain parity with the greenback into at least the first quarter of 2008. "Between red-hot commodity and energy markets and huge capital inflows associated with an avalanche of M&A deals, the Canadian currency has plenty of octane left to take a concerted run toward parity against the greenback," CIBC World Markets chief economist Jeff Rubin, said in a statement. ...



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