(Updates with comments from minister in third paragraph.)
Dec. 12 (Bloomberg) -- U.S. Steel Corp. and the Canadian government reached a settlement to end a court dispute over the company’s 2007 takeover of steelmaker Stelco Inc., Industry Minister Christian Paradis said.
U.S. Steel agreed to maintain operations in Canada until 2015 and make C$50 million ($48.7 million) in additional capital investments beyond the C$200 million it originally promised, Paradis said today in the country’s parliament.
“U.S. Steel has given significant new and enhanced undertakings under the Investment Canada Act,” Paradis said in a statement. “I have requested that the Attorney General of Canada discontinue the Government’s court action.”
Canada took Pittsburgh-based U.S. Steel to court in 2009 under the country’s foreign-takeover laws after it said the company hadn’t complied with pledges it made on spending, output, and research and development following the Stelco deal. Last month, Canada’s Supreme Court rejected U.S. Steel’s constitutional challenge of those laws.
U.S. Steel, the largest U.S. steelmaker by volume, will continue to operate at the Lake Erie and Hamilton plants in Ontario until 2015, according to the statement. It will also contribute C$3 million toward community and education programs in Hamilton and Nanticoke.
“We are pleased to have resolved amicably this unfortunate dispute with the government,” U.S. Steel said in an e-mailed statement. “The resolution reflects our ongoing and long term interest in doing business in Canada.”
--With assistance from Sonja Elmquist in New York. Editors: Paul Badertscher, Simon Casey
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