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U.S. Steel shares jumped Monday on a report that Cleveland-Cliffs is teaming up with rival Nucor for a potential bid for the company.
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The news comes after Nippon Steel's $14.1 billion takeover of U.S. Steel was blocked by President Joe Biden earlier this month, although the Japanese firm received an extension over the weekend on a deadline for when it has to drop the bid.
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Despite Monday's gains, shares of U.S. Steel have lost more than a fifth of their value in the past 12 months.
U.S. Steel (X) shares jumped Monday after a CNBC report that Cleveland-Cliffs (CLF) is teaming up with rival Nucor (NUE) for a potential bid for the company, whose $14.1 billion buyout by Nippon Steel was blocked by President Joe Biden recently.
Cleveland-Cliffs plans to acquire all of U.S. Steel in cash then divest the Big River Steel subsidiary to Nucor, CNBC reported. U.S. Steel’s headquarters would stay in Pittsburgh and the offer would be “in the high $30s a share,” according to the report.
Nucor declined to remark on the report and Cleveland-Cliffs didn't immediately respond to a request for comment.
Nippon Steel had planned to buy U.S. Steel for $55 per share. Over the weekend, the Japanese steel producer received an extension on the deadline on when it has to abandon that bid.
Cleveland-Cliffs Had Tried to Buy US Steel in 2023
Cleveland-Cliffs had offered to buy U.S. Steel in 2023 and backed out after the Nippon deal was announced in December of that year. The Ohio-based company's initial offer had the support of the United Steelworkers and less pushback from Washington, which has been pushing for a domestic buyer.
U.S. Steel and Nippon Steel said last week they are suing the U.S. government over the blocked deal. The companies also announced a separate suit against Cleveland-Cliffs, the company’s CEO Lourenco Goncalves, and Allied Industrial and Service Workers International Union President David McCall, alleging they “coordinated actions” to prevent their merger.
U.S. Steel shares rose over 9% to $37.49 in intraday trading Monday, though despite Monday's gains, they've lost more than a fifth of their value in the past 12 months.
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