Cliffs says it’s still interested in US Steel mills

In a timeline dating back to last August, iron mining and steelmaking firm Cleveland-Cliffs Inc. and its CEO have made clear their willingness to acquire most or all of the assets of Pittsburgh-based United States Steel Corp.

The Cleveland-based firm was not selected as the winning bidder for those assets by the board of directors of U.S. Steel, which instead opted for a competing bid from Japan-based Nippon Steel Corp.

That bid, which was later approved by a majority of U.S. Steel shareholders, has not been warmly received by the United Steelworkers (USW) union—which favored the Cliffs bid—or several politicians facing a contested election in which states hosting both U.S. Steel and Cliffs facilities can be characterized as in swing states in the presidential election or that are hosting a competitive U.S. Senate seat election.

Early September has seen the future of U.S. Steel gain prominence, with President Biden repeating a pledge to block the NSC purchase. Meanwhile, U.S. Steel and some of its employees have rallied in support of the deal.

Now, Cleveland-Cliffs board Chair, President and CEO Lourenco Goncalves has issued a statement conditionally commending President Biden if he blocks the NSC purchase and reiterating his company’s interest in acquiring at least some portions of U.S. Steel.

Goncalves, who often has expressed his support for the USW as a workplace partner, has singled out USW-represented mills and facilities as those in which Cliffs retains an interest.

“We commend President Biden and the U.S. government for its reported decision to block foreign ownership of U.S. Steel by Japan’s Nippon Steel,” says Goncalves, adding, “President Biden’s courageous move affirms our view that our industry is best served by American companies that are committed to the long-term prosperity of domestic manufacturing, supported by good paying union jobs, under American ownership.”

In the rest of his statement, the Cliffs CEO focuses on the USW presence within U.S. Steel, which is centered largely on its blast furnace/basic oxygen furnace (BOF) complexes in Pennsylvania and Indiana, plus a largely idled location in Illinois.

“It is no surprise to us that the USW adamantly opposes any transaction involving Nippon Steel, a company with an extensive track record of injurious trade practices,” Goncalves says.

In reference to an early September statement from U.S. Steel management, he continues, “The last-minute threats by U.S. Steel to shut down integrated steelmaking production, fire union workers and move their headquarters from Pittsburgh if their deal does not close is just a pathetic blackmail attempt on the U.S. government and the commonwealth of Pennsylvania.”

Regarding his company’s potential role in a different outcome, Goncalves remarks, “With the continued exclusive and unwavering support of the USW union, and with ample financing support available from our bank group led by J.P. Morgan and Wells Fargo, Cleveland-Cliffs stands ready to immediately acquire and invest in any and all union-represented assets that U.S. Steel shuts down, protecting union jobs and investing in the future livelihoods and communities in which the facilities operate.”

Among the nonunion U.S. Steel properties is the recycled-content Big River Steel electric arc furnace (EAF) complex in Arkansas. The proposed NSC purchase would include those assets, but Goncalves does not directly mention them in his early September comments.