The Ontario Superior Court of Justice (Commercial List) heard two motions within a long-standing Companies’ Creditors Arrangement Act (CCAA) proceeding concerning U.S. Steel Canada Inc. (now Stelco Inc.).
Stelco Inc. sought approval for a Securities Purchase Agreement (SPA) to acquire the remaining ownership interest in a Land Vehicle from various Stakeholders (employees, retirees, pensioners).
DGAP Investments Ltd., a defendant, brought a cross-motion seeking a strict timetable for the completion of a separate land sale agreement (DGAP Sale Agreement) before the SPA could close, alleging bad faith by Stelco.
The court granted Stelco's motion, finding the SPA beneficial to the Stakeholders by providing immediate monetization and extricating them from ongoing litigation.
DGAP's motion was dismissed, as the court found no evidence of bad faith by Stelco sufficient to delay the SPA, and determined that the SPA and DGAP Sale Agreement were not mutually exclusive.
The court emphasized continued judicial supervision and the Monitor's role in future transactions.