Cleveland-Cliffs says it still wants to buy U.S. Steel
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The CEO of steelmaker Cleveland-Cliffs reiterated he still wants to acquire rival U.S. Steel, in a news conference filled with intense and vehemently anti-Japan rhetoric.
Why it matters: This is the buyer that the United Steelworkers union wants, but it presents major antitrust challenges.
Catch up quick: Cleveland-Cliffs offered to buy U.S. Steel in late 2023, but U.S. Steel believed it was more likely to gain regulatory approval for a $14.9 billion offer from Nippon.
- After President Biden blocked the deal, U.S. Steel and Nippon sued Cleveland-Cliffs and its CEO Lourenco Goncalves, accusing them of illegally conspiring to scuttle the deal.
- They also sued the U.S. government, asking a court to set aside Biden's action.
Details: Goncalves, while speaking at a Butler, Pa., news conference, said that he wants again to bid on U.S. Steel, but cannot formally do so until it and Nippon abandon their deal.
- Goncalves also said that he has the support of Pennsylvania Gov. Josh Shapiro for such a bid, that he'd rename the entire company U.S. Steel and personally relocate to Pittsburgh.
- He did not comment on a CNBC report that Cleveland-Cliffs would partner on its bid with North Carolina-based Nucor. (Both stocks rose sharply on the report.)
Zoom in: The U.S. Steel comments were at times overshadowed by Goncalves' comments about Japan.
- "China is bad, China is evil, but Japan is worse ... Japan, beware. You don't understand who you are. You have not learned anything since 1945."
- He also criticized Nippon Steel for "teaching" China how to produce and overproduce (i.e., dump) steel, and said he's researched how to import dogs from Japan because he wants to go after Nippon's CEO for his money, "his house, and his dog."
The bottom line: Cleveland-Cliffs and Nucor are the two largest U.S. steel producers by volume, while U.S. Steel is number three, according to the World Steel Association.
- That's where the antitrust concerns come in, particularly in certain automotive applications.
- Goncalves repeatedly complimented President-elect Trump and his prior administration, perhaps to smooth a path.
