The nation’s second-largest domestic steel producer by volume, US Steel, has rejected an unsolicited $7.3 billion buyout proposal from competitor Cleveland-Cliffs, the third-largest domestic producer.
US Steel notes that it has received acquisition proposals from multiple other parties.
The board of directors for US Steel is commenting specifically on Cleveland-Cliffs’ offer due to a failure in negotiations between the parties.
“At this juncture, we cannot determine whether your unsolicited proposal properly reflects the full and fair value,” explains US Steel president and ceo David Burritt.
Kallanish understands that Cleveland-Cliffs’ offer represented a 42% premium above US Steel’s share price at the end of market close on 28 July, and a 43% premium above the current market price.
US Steel’s leadership “has made significant progress transforming the company into a customer-centric, world-competitive … steelmaker as we continue to win in strategic markets, move down the cost curve, and move up the talent curve,” Burritt adds.
Zach Johnson USA