KeyBanc analyst Philip Gibbs notes Cleveland-Cliffs (CLF) publicly announced a previously private offer it made to the board of U. S. Steel (X) on July 28 to acquire 100% of the latter’s outstanding stock for a total price of $35/share. The firm believes the offer from Cleveland-Cliffs is more than fair and the proforma company would create the largest steel company in North America, but views the probability of this deal getting done without meaningful concessions as low. This follows U.S. Steel’s press release over the weekend in which the company announced it was initiating a formal review process to evaluate strategic alternatives. KeyBanc has a Sector Weight rating on Cleveland-Cliffs.
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