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Cleveland Cliffs to Acquire AK Steel

Steel News - Published on Wed, 04 Dec 2019

Image Source: AK Steel
Cleveland-Cliffs Inc and AK Steel Holding Corporation announced that they have entered into a definitive merger agreement pursuant to which Cliffs will acquire all of the issued and outstanding shares of AK Steel common stock. Under the terms of the merger agreement, AK Steel shareholders will receive 0.40 shares of Cliffs common stock for each outstanding share of AK Steel common stock they own. Upon completion of the transaction, Cliffs shareholders will own approximately 68% and AK Steel shareholders will own approximately 32% of the combined company, respectively, on a fully diluted basis. Mr Lourenco Goncalves, Chairman of the Board, President and CEO of Cliffs, will lead the expanded organization.

The transaction will combine Cliffs, North America’s largest producer of iron ore pellets, with AK Steel, a leading producer of innovative flat-rolled carbon, stainless and electrical steel products, to create a vertically integrated producer of value-added iron ore and steel products. The combined company will be ideally positioned to provide high-value iron ore and steel solutions to customers primarily across North America.

Headquartered in West Chester, Ohio, AK Steel Corporation ranks as a middle tier integrated steel producer, operating steelmaking and finishing plants in Ontario in Canada, Indiana, Kentucky, Ohio, Michigan and Pennsylvania in United States. The company also has tube manufacturing facilities in Indiana, Ohio, and Mexico. Additionally, through its Precision Partners, AK Steel is involved in engineering, tooling, die design and hot and cold stamped steel parts. AK Steel produces flat-rolled carbon steels, including coated, cold-rolled and hot-rolled products, as well as specialty stainless and electrical steels. Principal end markets include automotive, steel service centers, appliance, industrial machinery, infrastructure, construction, and distributors and converters. Through its AK Coal Resources Inc. subsidiary, the company has interests in metallurgical coal production. Revenues for the twelve months ended September 30, 2019 were approximately USD 6.6 billion.

Headquartered in Cleveland, Ohio, Cleveland-Cliffs is the largest iron ore producer in North America with approximately 21.2 million equity tons of annual capacity. Commercial production at the Toledo, Ohio HBI facility is expected to begin mid-2020. For the twelve months ended September 30, 2019 Cliffs had revenues of USD 2.1 billion.

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Posted By : Arun Huidrom on Wed, 04 Dec 2019
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