Hanwha signs agreement with Algoma Steel to support new beam mill

Hanwha Oceans signed a memorandum of understanding with Algoma Steel pledging $275 million to help establish a structural steel beam mill, and the company said the agreement is worth about $345 million. The commitments are reported as conditional on Hanwha winning a federal contract to supply up to 12 submarines.

Hanwha Oceans announced a memorandum of understanding with Algoma Steel to support a new structural steel beam mill. The MOU pledges $275 million in financial support and the company said the agreement is worth about $345 million. Hanwha also declared an intention to purchase steel for construction of a proposed Canadian submarine fleet and for maintenance infrastructure on both coasts. Both the financial support and purchase intentions are reported as conditional on Hanwha winning a federal procurement contract to supply up to 12 submarines. Key details: - Hanwha pledged $275 million to help establish a structural steel beam mill in the MOU with Algoma Steel. - The company described the overall agreement as worth about $345 million in a news release. - Hanwha intends to buy steel for submarine construction and maintenance infrastructure if it wins the procurement contract. - The MOU requires Algoma to pay Hanwha Oceans 3% of net sales from the mill annually for ten years once the facility is established. - Algoma has been affected by U.S. steel tariffs, recently announced layoffs, and received $500 million in financing from the federal and Ontario governments. - Hanwha Systems also signed cooperation agreements with Canadian firms including Telesat, MDA Space, Cohere and PV Labs during a South Korean delegation visit. Summary: If Hanwha is awarded the federal submarine procurement contract, the agreement would support domestic steel production and involve long-term purchase commitments. The procurement award could occur as early as this year; otherwise the timing and outcome are undetermined at this time.