Stelco Holdings Inc STZHF

Buying competitors or dividends?

[prested]

I wonder if the CEO will chose to go empire building instead of using the surplus cash for shareholders immediate reward. If he truly believes the price of steel has bottomed and will now rise considerably this would be a good time to make an acquisition, rather than spend more money buying back Steco's increasingly expensive shares. The longer he sits on the cash the less likely we are to see any significant dividend increase, which is what I personally am hoping for.

[geosan0]

Been reading your posts prested and would just like to comment on your question of surplus cash and making an acquisition. Alan K. was asked about that about a year ago and he said that any acquisition would be dilutive to the shareholders of STLC because STLC is the lowest cost producer in North America so he doesn't see the need to buy someone to increase his cost structure.  That said

[Eastbank]

Believe it was stated in the SIB offering that majority shareholders would not be participating. That said and with expectations of a low ratio of tendering by retail investors, there should be plenty of cash left over from the land sale to divvy up to shareholders. GLTA