(AOF) – Steel producer, US Steel jumped more than 25% to 28.48 dollars in New York after rejecting an unsolicited offer to buy Cleveland-Cliffs in cash and stock. The offer valued US Steel at approximately $7.3 billion and sought to acquire all outstanding shares of US Steel. According to the letter from US Steel Chief Executive David B. Burritt, his group “was unable to properly evaluate the proposal because Cleveland-Cliffs refused to sign a confidentiality agreement unless US Steel does not accept the economic conditions in advance”.
Cleveland-Cliffs is a Cleveland, Ohio-based company specializing in iron ore mining, beneficiation and pelletization, as well as steel fabrication, including stamping and tooling.
“As you know, our board of directors – or any other board of directors – could not, in accordance with its fiduciary duties, accept a proposal of which 50% is represented by your shares without carrying out a thorough due diligence process and quite usual, in order to assess the risks and the potential advantages and disadvantages inherent in the transaction, including the “equity” component, can be read in this letter explaining this refusal.
“At my request and that of the Board of Directors, our advisors have indicated our willingness to enter into a non-disclosure agreement with you on August 7, 2023, so that we can obtain further clarity on several key issues, including evaluation of the equity component of your proposal, regulatory risk and timing, and the outlook for the combined business,” David B. Burritt points out in the letter.
“We have discussed with your attorney the issues that should be better understood so that we can both appropriately assess the antitrust risk of your proposal. And while your attorney agreed that this should be analyzed, and it was supportive of our proposal to work on it together, it still hasn’t happened,” says the US Steel general manager.
© 2023 Agence Option Finance (AOF) – All rights reserved by AOF. AOF collects its data from the sources it considers the most reliable. However, the reader remains solely responsible for their interpretation and for the use of the information made available to them. Thus the reader must hold AOF and its contributors harmless from any claim resulting from this use. Agence Option Finance (AOF) is a brand of the Option Finance group
Did you like this article ? Share it with your friends with the buttons below.
