Citi analyst Alexander Hacking views Cleveland-Cliffs (CLF) as the only logical acquirer for 100% of U.S. Steel (X). Most global steel companies are looking to reduce their blast furnace footprint, not add to it, and ArcelorMittal (MT) recently sold its U.S. blast furnace operations to Cleveland-Cliffs, the analyst tells investors in a research note. The firm believes U.S. Steel is likely worth far more to Cleveland-Cliffs than anybody else given the commercial implications. It also thinks the U.S. government “is likely to take a long, hard look at the deal.” Citi pegs U.S. Steel’s long-term scenario value closer to $46 per share and says Cleveland-Cliffs’ offer “appears opportunistic.” It keeps a Neutral rating on U.S. Steel with a $30 price target.
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