HAMILTON — Stelco Holdings Inc. has signed a deal to buy back about 13 per cent of its outstanding shares from one of its largest shareholders for $398 million.
The steelmaker says it will buy back and cancel nearly 11.4 million shares from LG Bedrock Holdings LP at a price of $34.93 per share.
Stelco shares closed at $47.28 on the Toronto Stock Exchange on Thursday.
The deal will reduce LG Bedrock's stake in Stelco to 9.9 per cent from 21.5 per cent.
By buying back its shares, a company spreads profits over fewer shares. That increases its earnings per share, a key ratio used to determine a company's financial health.
Stelco says it will fund the share repurchase plan with cash on hand and that it remains well positioned to fund its ongoing strategic capital initiatives.
This report by The Canadian Press was first published Aug. 13, 2021.
Companies in this story: (TSX:STLC)
The Canadian Press