Lakeside sets sights on Stelco purchase

Lakeside Steel Inc. wants to buy the former Stelco from U.S. Steel, a move it says would "repatriate a Canadian icon."

The Welland-based pipemaker -- backed by institutional investors -- is asking the Federal Court of Canada to force Pittsburgh-based U.S. Steel to sell its plants in Hamilton and Nanticoke.

If its bid is successful, Lakeside has pledged to reopen the Canadian plants immediately. It has also vowed to abide by the production and employment commitments U.S. Steel made to the Canadian government when it bought Stelco in 2007.

"We think now is the time to bring Stelco back into Canadian hands," said Lakeside CEO Vic Alboini, a Hamilton native whose father worked at Stelco. "You can't just shut it down. There are a lot of jobs and people at stake here."

Industry Minister Tony Clement says U.S. Steel violated its commitments when it shut down the former Stelco in March. He has asked the Federal Court of Canada to order the firm to live up to those promises or face fines of $10,000 a day.

U.S. Steel declined to comment yesterday.

The firm has promised to fight the government lawsuit, saying the Canadian shutdowns were driven by economic factors beyond its control.

Alboini believes U.S. Steel is under pressure from American officials to comply with the so-called "Buy American" rules attached to U.S. economic stimulus plans. As a result, he said, the firm is more likely to restart its American-based mills while its Canadian operations remain idle.