Steel giant ArcelorMittal sells U.S. operations to Cleveland-Cliffs for $1.4 billion

The deal makes Cleveland-Cliffs the largest flat-rolled steel and iron ore pellet producer in North America, said CEO Laurenco Goncalves.

SHARE Steel giant ArcelorMittal sells U.S. operations to Cleveland-Cliffs for $1.4 billion
ArcelorMittal’s facility in Burns Harbor, Ind.

ArcelorMittal’s facility in Burns Harbor, Ind.

Sun-Times files

Steel giant ArcelorMittal parted with its U.S. operations in a $1.4 billion deal with ore-mining company Cleveland-Cliffs Inc., the group announced Monday morning.

As a part of the deal, the Cleveland-based mining company acquired six steelmaking facilities, eight finishing facilities, two mining and pelletizing operations and three coal and coke-making operations, according to a presentation from the mining company. This includes facilities in Riverdale and Northwest Indiana.

“This transaction brings together two of the most important companies in North America,” Lakshmi Mittal, chairman and CEO of ArcelorMittal, said on a conference call.

According to a press release, Cleveland-Cliffs acquired 100% of ArcelorMittal’s shares —one-third in cash, the rest in stock. The deal will make Cleveland-Cliffs the largest flat-rolled steel and iron ore pellet producer in North America, said Laurenco Goncalves, Cleveland-Cliffs CEO.

Earlier this year, Cleveland-Cliffs completed the acquisition of Ohio-based steelmaking company AK Steel for around $1.1 billion in stocks; that deal began late last year.

“With our acquisition of ArcelorMittal USA announced this morning, Cleveland-Cliffs will complete the second step of this transformation into a fully-integrated, high-value steel enterprise,” Goncalves said.

Aditya Mittal, president and chief financial officer of ArcelorMittal, said the deal will save his his company about $150 million in areas such as sourcing raw materials and supply chain efficiencies.

Aditya Mittal said the repositioning of ArclelorMittal’s North American operations will allow the company to focus on its other “highly competitive suite of assets,” which include its facilities in Canada, Calvert, Alabama and Mexico.

ArcelorMittal also expects about $500 million in cash proceeds from the deal to be distributed to shareholders through a buyback program that began Monday, according to the press release.

In 2018 and 2019, ArcelorMittal USA averaged $10 billion in annual revenue, compared to $2 billion for Cleveland-Cliffs.

Contributing: Associated Press

The Latest
Despite getting into foul trouble, which limited him to just six minutes in the second half, Shannon finished with 29 points, five rebounds and two assists.
Cowboy hats, bell-bottoms and boots were on full display Thursday night as fans lined up for the first of his three sold-out shows.
The incident occurred about 3:40 p.m. near Minooka. The horse was successfully placed back into the trailer, and the highway reopened about 40 minutes later. No injuries were reported.
The Hawks conceded the game’s only two goals within the first seven minutes and were shut out for the 12th time this season in a 2-0 defeat Thursday.