US STEEL Hamilton options poll. VOTE IN THE POLL

FROM STEEL MARKET UPDATE    (Please vote in the poll to the right)

The Canadian federal court system has allowed a government suit against U.S. Steel to continue with the main gist of the suit being U.S. Steel broken promises of full employment and production at certain specified annual tonnages as conditions of the purchase of the steel mill. The law suit brought by the Canadian government does not ask for the courts to take the properties away from USS. Our understanding is if USS loses the suit they are liable to pay fines of approximately $10,000 per day.
The local union in Canada is hoping the potential loss of the suit will prompt either U.S. Steel to sell off the former Stelco mill(s) or, that the Canadian government would seize the mill. The article by Mr. Livingstone and Mr. Wright spells out the four potential options for ownership of the mill should USS loses control:


1) “Further foreign takeover.”

2) “Repurchase by Canadian private capital.”                                

3) “Creation of a government-owned (or Crown) corporation.”

4) “Support for worker ownership.”

The first option, as laid out in the article Steel Market Update, is the premise U.S. Steel could be taken over by another foreign (non-Canadian) entity and they mention ArcelorMittal as a potential acquirer.

A second option would be for a Canadian based company to repurchase the Hamilton and Lake Erie steel mills. Lakeside Steel, a pipe and tube manufacturer in Canada, has filed a motion with the federal court of Canada to force U.S. Steel to sell the plants due to the violation of their purchase agreement with the government. The article reports Lakeside itself is not large enough to purchase the mill alone “…but has involved large institutional investors both inside and outside Canada in preparing a bid.”

The 3rd option is to create a “Crown” corporation, which means the Canadian government would purchase the company much like the U.S. government and Canadian government’s combined bailed out General Motors.

The 4th option is for the creation of a “union co-op” whereby the workers purchase the mills much the same as the co-operative which owns Mondragon International in Spain.
“Basic features of Mondragon worker ownership are the following: All workers have a share and a vote according to the principle of one worker, one vote; decisions on the direction of the firm are made in regular assemblies; the highest-paid manager worker is not paid more than six times the rate of the lowest worker; revenues are retained within the firm and the Mondragon co-operative system; the system is capitalized through its own co-operative bank; and retirees can cash out their shares but cannot sell them to outsiders for speculative profit taking.