India  
NewsR.in
> >

Cleveland-Cliffs to Buy AK Steel - A Bright and Shiny Merger?

Video Credit: The Street - Duration: 01:48s - Published < > Embed
Cleveland-Cliffs to Buy AK Steel - A Bright and Shiny Merger?

Cleveland-Cliffs to Buy AK Steel - A Bright and Shiny Merger?

Iron ore pellet producer Cleveland-Cliffs s buying flat-rolled carbon, stainless steel and electrical products maker AK Steel for $1.1 billion.

But is it a bright and shiny deal for investors?

Under terms of the deal announced on Tuesday, AK Steel shareholders will receive 0.4 a Cleveland-Cliffs share for each AK Steel share at $3.36 a share, which represents a premium of 16% based on the closing share prices of Cleveland-Cliffs and AK Steel, respectively, as of Monday Dec.

2, and a premium of 27% based on the 30-day volume-weighted average price of AK Steel common shares.

When finalized, Cleveland-Cliffs shareholders will own approximately 68% and AK Steel shareholders will own approximately 32% of the combined company.

Cliffs CEO Lourenco Goncalves will lead the combined company, while AK Steel CEO Roger Newport will retire.

The transaction is expected to close in the first half of 2020, subject to approval by shareholders of both companies as well as receipt of regulatory approvals and other typical closing conditions.

As part of the agreement, Cliffs said it has obtained an approximately $2 billion financing commitment from Credit Suisse in connection with a new asset-backed loan and the refinancing of AK Steel's 2023 senior secured notes.

For shareholders, the question is whether a combined Cleveland-Cliffs-AK Steel will make sense in the long run.

Cleveland-Cliffs' shareholders appear to think less so, with the company's shares plunging at the open on Tuesday, falling more than 13% to $7.29.

For AK Steel stockholders, it was a slightly more optimistic tune, with shares gaining 4.5% to $2.94.'

Bull Market Fantasy: LIVE TUESDAY & THURSDAY @10:45AM Subscribe to our Youtube Channel for more videos : Listen our latest Podcasts on Soundcloud Catch Up: Today's Top News Videos Below

0
shares
ShareTweetSavePostSend
 

You Might Like


Tweets about this

skjupnorthski

kelly❤⚾ RT @JustinPerpich: Actually Cleveland Cliffs CEO credits Amy Klobuchar & Rick Nolan for fixing the steel industry. Them working with Obama… 3 days ago

JustinPerpich

Justin Perpich Actually Cleveland Cliffs CEO credits Amy Klobuchar & Rick Nolan for fixing the steel industry. Them working with O… https://t.co/ZbE9LaNy6F 3 days ago


Recent related videos from verified sources

AK Steel purchased by Cleveland-Cliffs [Video]AK Steel purchased by Cleveland-Cliffs

Cleveland Cliffs did say it expects to consolidate some corporate roles in the merger, but did not say what that might mean for jobs in West Chester. The company says it plans to keep that office open...

Credit: Rumble     Duration: 01:35Published

Environmentally friendly: newsR is hosted on servers powered solely by renewable energy
© 2020 newsR Ltd. All Rights Reserved.
About us  |  Contact us  |  Disclaimer  |  Terms & Conditions  |  Content Accreditation
 RSS  |  News for my Website  |  Free news search widget  |  In the News  |  DMCA / Content Removal  |  Privacy & Data Protection Policy
How are we doing? FeedbackSend us your feedback  |   LIKE us on Facebook   FOLLOW us on Twitter  •  FOLLOW us on Pinterest