Cleveland-Cliffs (NYSE:CLF) shares fell Tuesday, a day after they rallied 8.8% for their best day of 2023. The stock popped after its $7.3 billion bid to buy U.S. Steel (NYSE:X) was rejected.
Cleveland-Cliffs said it made an offer to U.S. Steel's board on July 28 consisting of $17.50 in cash and 1.023 shares of Cliffs stock, according to statement on Sunday. The offer, which as of the close of Friday values U.S. Steel at $32.53 per share, represents a 43% pr
Cleveland-Cliffs said it remains prepared to engage immediately in "substantive discussions" with U.S. Steel to work towards a mutually acceptable definitive agreement and is ready to commit all necessary resources to finalize documentation. A combined Clifffs and U.S. Steel would have generated synergies of about $500 million.
The United Steelworkers union affirmed in writing to Cliffs that it endorses the transaction and will not exercise this right. The USW has also stated that it will not endorse anyone other than Cliffs for a transaction, according to the Cliffs statement.
Said David B. Burritt, U. S. Steel’s CEO. "This decision follows the Company receiving multiple unsolicited proposals that ranged from the acquisition of certain production assets to consideration for the whole Company.
The Board is taking a measured approach to considering these proposals, including seeking more information in order to evaluate proposals that are preliminary and subject to ongoing due diligence and review.”
CLF shares began Tuesday down 22 cents, or 1%, to $21.17.
