Cliffs Acquiring ArcelorMittal USA
By Metal Center News Staff
on Sep 28, 2020
Cleveland-Cliffs Inc. has expanded its steelmaking holdings with a $1.4 bilion purchase of ArelorMittal USA. The deal follows Cliffs’ previous acquisition of U.S. steelmaker AK Steel, and will position the Cleveland-based company as North America’s largest flat-rolled steel producer with 17 million net tons of capacity.
“Steelmaking is a business where production volume, operational diversification, dilution of fixed costs, and technical expertise matter above all else, and this transaction achieves all of these. ArcelorMittal is a world class organization that we have long admired as our customer and our partner, and we know for a fact that they have taken good care of their U.S. assets,” says Lourenco Goncalves, chairman of the board, president and CEO of Cleveland-Cliffs.
The acquisition includes six steelmaking facilities, eight finishing facilities, two iron ore making and pelletizing operations and three coal and coke making operations. The company will become the largest iron ore pellet producer in North America, with 28 million long tons of capacity.
In 2018 and 2019, ArcelorMittal USA averaged approximately $10.4 billion in revenues.
“We are creating an exceptional company, based on great people and supported by our existing strong relationship with the United Steelworkers, the United Auto Workers and the Machinists unions. The acquisition of ArcelorMittal USA amplifies our position in the discerning automotive steel marketplace, and further improves our position in important U.S. markets such as construction, appliances, infrastructure, machinery and equipment,” Goncalves said. “It also adds to our strong legacy raw material profile and growing finishing capabilities. The transaction will enable us to become a more efficient fully-integrated steel system, with the ability to realize all of our operational and financial goals.”