Algoma Steel Group Inc. announced the execution of binding term sheets to secure C$500 million in liquidity support from the Governments of Canada and Ontario. This comprises C$400 million in loan facilities from the Government of Canada under the Large Enterprise Tariff Loan facility and C$100 million from the Province of Ontario.
These facilities have a seven-year term, with interest at CORRA + 200 basis points for three years, stepping up by 200 basis points each year thereafter, and include warrants. The support is deemed essential financial flexibility amid prolonged trade uncertainty and positions Algoma to advance its business transformation.
In response to the ongoing 50% Section 232 tariffs effectively closing the U.S. market, Algoma will begin to exit its blast furnace and coke oven operations, accelerating its transition to Electric Arc Furnace (EAF) steelmaking. The final aggregate cost of the EAF project is now expected to be approximately C$987 million, and future production will focus on as-rolled and heat-treated plate, along with select coil products predominantly for the Canadian market.
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