Cleveland Cliffs Purchasing AK Steel
West Chester-based steelmaker AK Steel is being purchased by Cleveland-Cliffs, North America's largest producer of iron ore pellets.
The stock deal is valued at 1.1 billion dollars. The companies say they are creating a vertically integrated business under which Cliffs would get access to AK's flat-rolled carbon, stainless and electrical steel products operations. Under the deal, AK Steel Holding Corporation stockholders will receive 0.40 shares of Cliffs stock for each AK Steel share they own. Cliffs shareholders will own approximately 68 percent of the combined company and AK Steel shareholders will own about 32 percent.
After a brief spike in steel prices, U.S. steel producers have struggled since the Trump administration put tariffs into place last year. And domestic demand has slumped along with the energy sector as drillers pull back on purchases of steel pipe.