Have you seen our advertisement in the paper today? If not, you should have a look.
We published this ad because we are concerned about the future of Algoma, we are concerned about the Sault Ste Marie community and we are concerned about the misinformation that is being spread by those who want you to believe that Algoma is “just fine”.
Don’t be fooled by “support agreements” announced by USW 2251. Employees, retirees and the community need to understand three important facts:
- A “support agreement” is NOT a collective agreement – it is nothing more than an agreement between USW 2251 and its own consultant.
- USW Local 2251 does not even have the legal right to bind the company into these types of agreements and the company is NOT bound.
- The secured creditors are the only party that has put forward a viable plan with committed capital to create a profitable, sustainable Algoma – USW and its locals need to bargain with us and stop pursuing alternatives that are not viable.
The company is in its fourth restructuring. There have been last minute saviours who did more harm than good, and those who want you to believe they have the miracle cure.
There is no miracle cure today. Algoma is in serious trouble and requires real change, because:
- The steel market has changed dramatically over the past 10 years
- Algoma’s cost structure is significantly higher than its North American competitors
- Substantial new investment in equipment and facilities is required to modernize the plant and catch-up on years of under-investment
- Algoma needs a significant infusion of new money
The secured creditors have the financial strength, the committed capital, and the plan to create a strong, sustainable Algoma.
We are prepared to reduce the company’s debt by C$1.5 billion. Our plan also provides for the injection of over C$500 million of new capital and the funding of over C$400 million of capital expenditures over the next five years.
But our plan can only work if Algoma has a competitive cost structure and labour cost stability.
We need responsible collective bargaining agreements with USW Local 2251 and USW Local 2724 that will take us through the next five years. We want to achieve those agreements through meaningful negotiations without further delay. We call on the unions to do likewise.
In order to achieve collective bargaining agreements our plan:
- Assumes the hourly and salaried defined benefit pension plans, meaning that the hourly and salaried retirees continue to receive their current pensions, and provides runway for the financial status of these plans to improve;
- Provides continuance of core medical benefits for all employees and retirees;
- Improves the profit-sharing program, ensuring that when Algoma does well, all employees will receive additional compensation.
Any competing offer that may get filed has to deal with our $1 billion of debt – we will not support any offer that does not right-size the cost structure and substantially improve Algoma’s long term prospects.
Getting this restructuring right is important for us and it should be for you too.
Our plan can create a bright long term future for employees, retirees, the company and the community. Let’s work together to make it happen.