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TAKEAWAYS KEY
- U.S. Steel’s shares rose Monday after a report stating that Cleveland-Cliffs was partnering with Nucor to make a bid on the company.
- The news comes after Nippon Steel's $14.1 billion takeover of U.S. Steel was blocked by President Joe Biden earlier this month, although the Japanese firm received an extension over the weekend on a deadline for when it has to drop the bid.
- Despite Monday's gains, shares of U.S. Steel have lost more than a fifth of their value in the past 12 months.
U.S. Steel shares (X) soared Monday following a CNBC article that Cleveland-Cliffs is teaming with Nucor to make a bid on the company. The President Joe Biden had recently blocked Nippon Steel’s $14.1 billion purchase of U.S. Steel.
CNBC reported that Cleveland Cliffs planned to purchase U.S. Steel and divest Big River Steel to Nucor. U.S. Steel would keep its headquarters in Pittsburgh. The offer was to be made by Nucor. “in the high $30s a share,” According to the report
Nucor declined to remark on the report and Cleveland-Cliffs didn't immediately respond to a request for comment.
Nippon Steel was planning to acquire U.S. Steel shares for $55 each. The Japanese steelmaker received a deadline extension over the weekend.
Cleveland-Cliffs had tried to buy US Steel by 2023
Cleveland-Cliffs offered to purchase U.S. Steel by 2023, but backed out when the Nippon agreement was announced that December. United Steelworkers supported the initial Ohio company offer, while Washington was less receptive. Washington had been pressing for a domestic purchaser.
U.S. Steel & Nippon Steel filed a lawsuit against the U.S. federal government last week over the deal that was blocked. The companies also announced a separate suit against Cleveland-Cliffs, the company’s CEO Lourenco Goncalves, and Allied Industrial and Service Workers International Union President David McCall, alleging they “coordinated actions” They must be prevented from merging.
U.S. Steel shares rose over 9% to $37.49 in intraday trading Monday, though despite Monday's gains, they've lost more than a fifth of their value in the past 12 months.
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