Sept 24 (Reuters) - Shares of Stelco Holdings Inc STLC.TO fell as much as 8.5% on Tuesday after the Canadian steel company withdrew its $300 million debt offering, citing "current bond market conditions".
The company said last week it planned to offer senior secured notes due 2024 to raise money for capital expenditures and corporate purposes, including potential acquisitions or other deals.
Stelco's withdrawal comes at a time when industry experts are predicting continued weakness in steel prices. States Steel Corp X.N warned of weakening demand last week and forecast a bigger-than-expected loss for the third quarter. are having a hard time getting comfortable with steel names in general and a poor guidance from U.S. Steel didn't help with investor sentiment, said Dhruv Mallick, a fixed income high yield manager at Leith Wheeler Investment Counsel Ltd.
Stelco's planned offering was rated as junk by global ratings agencies Moody's and S&P Global Platts. Moody's cited expected cash flow volatility at the company amid sharp movements in steel prices among constraints to its rating.
The company could not immediately be reached for comment about how it plans to raise funds after scrapping the offering.
Last week, coal miner Peabody Energy Corp BTU.N scrapped its planned offerings of $1 billion in senior secured notes, saying it did not see an economic way of completing the offers in current debt market conditions.