CLF Stock Alert: Cleveland-Cliffs Announces Purchase of Stelco

Cleveland Cliffs (NYSE:CLF) shares are moving on Monday after the flat steel producer announced the acquisition of Stelco (OTCQB:STZHF) for 3.4 billion Canadian dollars.

Cleveland-Cliffs is paying 70 Canadian dollars per share for the Canadian steel company. This represents a premium of 87% on Friday’s closing price. It is also a premium of 37% on the 52-week high.

Lourenco Goncalves, Chairman, President and CEO of Cleveland-Cliffs, said the following about the Stelco acquisition.

“Stelco is a company that respects the union, treats its employees well and leverages its cost advantages, making them a perfect fit for Cleveland-Cliffs and our culture. We look forward to proving that our ownership of Stelco will be a net gain for Canada, the Province of Ontario and the cities of Nanticoke and Hamilton.”

CLF shares: Details on the Stelco deal

Cleveland-Cliffs must obtain approval from regulators and two-thirds of its shareholders before the deal can be completed. Stelco needs approval from a majority of its shareholders to complete the deal.

If all goes well, the two companies expect the acquisition to close in the fourth quarter of 2024. The boards of both companies advise shareholders to vote in favor of the agreement.

CLF shares are up slightly, while STZHF shares are up 73.4% since Monday morning.

Investors who want to know more about the latest stock market news are in luck!

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At the time of publication, William White had no position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com Publishing guidelines.