Essar Global Acquires Algoma Steel for $1.85B

On June 20, 2007, Essar Global Limited, through its wholly owned subsidiary, Essar Steel Holdings Limited, completed its acquisition of Algoma Steel Inc. The transaction was effected under a statutory plan of arrangement, pursuant to which an indirect subsidiary of Essar Steel Holdings Limited acquired 100 per cent of the outstanding Algoma common shares for cash consideration of $56 per Algoma common share or an aggregate equity value of approximately $1.85 billion.

Essar Global Limited is an international conglomerate operating in six business areas—steel, oil & gas, power, communications, shipping & logistics and construction. Essar Steel Holdings Limited is an emerging global steel company and one of the lowest-cost producers of steel globally. Algoma Steel Inc. is an integrated steel producer based in Sault Ste. Marie, Ontario with steel shipments of 2.4 million tons in 2006.

Essar was represented by Mukesh Bhavnani, its group president–legal, and by Stikeman Elliott LLP with a team that included William Braithwaite, John Ciardullo, Stewart Sutcliffe, Mark Fedorowycz and Katrina Svihran (mergers and acquisitions); Peter Hamilton, Ian Putnam, Lewis Smith, Gwen Cheung, Meaghan Obee Tower and Alwin Kong (financing); Paul Collins and Jeff Brown (regulatory); Elizabeth Pillon (litigation); John Lorito (tax); Bruce Pollock and Nancy Ramalho (employment); Larry Cobb (environmental); Andrea Boctor (pensions); and Corinne Pruzanski (real estate). Legal representation in the United States was provided by Cleary Gottlieb Steen and Hamilton LLP with a team that included Craig Brod, Mark Walker, Ana Demel, Hadi Nicholas Deeb, James Small, Mark Drury, David Webb and Ana Gercas (financing); and Kerri Chase (regulatory).

Algoma was represented by Paul Finley, its vice-president–business planning and corporate secretary, and Victoria Chiappetta, assistant to the vice-president–business planning, and in Canada and the United States by Torys LLP with a team that included Peter Jewett, Kevin Morris, John Emanoilidis, John Guccione and Trish Randell (mergers and acquisitions); John Unger (tax); Jim Tory and Andrew Gray (litigation); Andy Beck (US corporate and securities); Jay Holsten (competition); Craig Pell and Phil Mohtadi (regulatory); Dennis Mahony (environmental); and Christina Medland (pensions and employment). Jon Levin of Fasken Martineau DuMoulin LLP advised the special committee of the board of directors of Algoma.

UBS Investment Bank, the exclusive financial advisor to Essar and sole arranger of Essar's transaction financing, was represented by Blake, Cassels and Graydon LLP with a team that included Peter MacGowan, Brendan Reay and James Hoffner (financing) and Leslie Morgan (tax) and by Latham and Watkins LLP with a team that included Tracy Edmondson, Chris Plaut, Donald Schwartz, David Baroni and Barry Blankfield (financing).