Stelco’s owners, who have been lamenting undervalued share prices, got a giant shot in the arm Monday with investment company Fairfax Holdings Inc. buying a 13.7 per cent stake in the steelmaker.
The move means the investment firm chaired by billionaire Prem Watsa will spend $250 million to buy 12.2 million shares at $20.50 a share.
Stelco Holdings Inc. shares closed at $20.68 on the Toronto Stock Exchange, up 5.13 per cent on the day. That comes after a ten per cent jump in Stelco share value last week after strong third quarter results. The company announced an 84 per cent increase in revenue and 43 per cent jump in shipping volumes compared to the same quarter last year.