ArcelorMittal unlocks value through separation of integrated US assets and repositions its footprint in North America

 

28 September 2020, 07:45 CET

ArcelorMittal (the “Company”, “Group”) announces it has entered into a definitive agreement (the “Agreement”) with Cleveland-Cliffs Inc. (“Cleveland-Cliffs”) pursuant to which Cleveland-Cliffs will acquire 100% of the shares of ArcelorMittal USA (the “Transaction”) for a combination of cash and stock.
                                                 
Transaction Highlights

Under the terms of the agreement, ArcelorMittal expects to receive an aggregate equity value consideration of $1.4 billion upon closing of the Transaction. Approximately one third of the consideration is in upfront cash ($505 million). The remaining two thirds of the consideration is in the form of equity:
                                                                                                   

• stock component of approximately 78 million shares of Cleveland-Cliffs common stock with value of $500 million¹; and
• non-voting preferred stock redeemable for approximately 58 million shares of Cleveland-Cliffs common stock with an aggregate value of $373 million or an equivalent amount in cash².

In addition, Cleveland-Cliffs will assume the liabilities of ArcelorMittal USA, including net liabilities of approximately $0.5 billion and pensions and other post-employment benefit liabilities (“OPEB”) which Cleveland-Cliffs values at $1.5 billion³.

Benefits to ArcelorMittal from the Transaction
                                  
Transaction crystallizing compelling value to ArcelorMittal’s shareholders