Cleveland-Cliffs and Nucor are preparing to submit a joint bid to acquire US Steel, following US President Joe Biden’s recent decision to block Nippon Steel’s $15 billion takeover of the Pennsylvania-based company.
“As part of the planned offer, Cleveland-Cliffs will buy all of US Steel in cash and then sell the target’s Big River Steel unit to Nucor”, said sources about the matter.
Cleveland-Cliffs plans to offer less than $40 a share to buy US Steel, significantly below the $55 a share, Nippon Steel had agreed to pay last year before Biden killed the transaction over national security concerns.
Nucor, North America’s largest steel producer, initially engaged with certain US Steel shareholders to seek support for a potential bid targeting the company’s electric furnace assets, according to sources familiar with the matter. Later, it reached an agreement to collaborate with Cleveland-Cliffs, the sources added.
Cleveland-Cliffs chief executive Lourenco Goncalves plans to present his new proposal on Monday in Pennsylvania, where he plans to make commitments to preserve US jobs while continuing investing in US Steel.
Report says that US Steel have emphasized that the company remains firmly committed to completing a deal with Nippon Steel. The Japanese steelmaker’s acquisition attempt, however, became entangled in a political controversy during the 2024 US presidential election.
The two companies have filed a lawsuit alleging the Biden administration of “unlawful political interference,” which in their view blocked the transaction in an effort to win union support in the 2024 race in the crucial swing state of Pennsylvania.
Source: Financial Times