No rush on new Algoma shares

Investors were hardly rushing to buy Algoma Steel Inc.'s new common shares when they were posted for trading on the Toronto Stock Exchange this morning.

CIBC World Markets Inc. bought one share at the opening price of $13 at 9:33 a.m.

The next trade was at 10:29 a.m., when TD Securities Inc. bought 100 shares for $5 each.

That was it for the rest of the morning.

At the time of our last update (12:45 p.m. on Thursday) no other trades had occurred, and the latest bid price was $3.

"We don't have a recommendation on it," Ford Upton, an investment advisor with the Sault office of Edward Jones, told SooToday.com.

The restructured company has no track record, so any decision now to buy Algoma shares would be speculative, Upton said. "In the short term, we're probably going to see some volatility. It will be more opinion than fact."

Because of strong local interest in Algoma's future, Upton was nonetheless keeping a close eye on the ticker today.

20 million new Algoma Steel Inc. common shares were posted for trading this morning on the TSE, under the symbol AGA.

According to the company's plan of arrangement and reorganization, former holders of the Algoma's first mortgage notes received 15 million new common shares, employees received 4 million new shares and unsecured creditors who did not take cash for their unsecured claims got 1 million shares.

Algoma's old stock is worthless and holders of it are not entitled to receive new stock in exchange for their shares.

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