1839688 Alberta ULC -- Moody's assigns B3 rating to ESA's subsidiary's note issue; outlook stable

New York, November 20, 2014 -- Moody's Investors Service assigned a B3 rating to 1839688 Alberta ULC's $252 million junior secured (third lien) notes. The notes are guaranteed by Essar Steel Algoma Inc (ESA) and other subsidiaries of ESA. These junior secured notes have been issued in exchange for the 9.875% senior unsecured notes due March 15, 2015. The junior secured notes are pay-in-kind or cash at the company's option. In addition, Moody's withdrew the Caa2 rating on ESA's 9.375% senior secured notes due March 2015 and the C rating on the 9.875% senior unsecured notes due June 2015. These notes were repaid with the proceeds from ESA's recapitalization and refinancing. Moody's also withdrew the B3 rating on the senior secured third lien notes, which notes were not issued. All other ratings remain unchanged, including the B2 Corporate Family Rating (CFR). Moody's notes that the senior secured term loan and senior secured notes were increased to $375 million. The outlook is stable.

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