Ontario Steel Investment Limited announced Tuesday that it has signed a letter of intent to negotiate the framework of a US$900 million purchase of Essar Steel Algoma.
Ontario Steel, which includes shareholders of Essar Global, said on Tuesday it would assume Algoma's pension and benefit liabilities as part of the agreement.
The letter of intent was signed in conjunction with the United Steelworkers Union, Local 2251.
Ontario Steel said it would also pay outstanding taxes owed to the city of Sault Ste. Marie, where Algoma is based, within six months of a change in ownership.
Essar Global said in a statement last month that it did not support a deal to sell Essar Steel Algoma's assets to a consortium formed by private equity firm KPS Capital Partners.
Algoma, bought nearly a decade ago by Indian energy and resources conglomerate Essar Global, had put itself up for sale while operating under creditor protection.
