Cleveland-Cliffs to re-focus capital allocation towards ‘aggressive’ buybacks

Cleveland-Cliffs (CLF) Chairman, President of CEO Lourenco Goncalves issued the following statement earlier regarding the announced proposed acquisition of U.S. Steel (X) by Nippon Steel (NPSCY): “We identified U.S. Steel as an extremely undervalued company with significant synergy potential when combined with Cleveland-Cliffs, creating a union-friendly American champion among the top-10 steelmakers in the world. Even though U.S. Steel’s Board of Directors and CEO chose to go a different direction with a foreign buyer, their move validates our view that our sector remains undervalued by the broader market, and that a multiple re-rating for Cleveland-Cliffs is long overdue. We congratulate U.S. Steel on their announcement and wish them luck in closing the transaction with Nippon Steel. As we have been guiding, we have already reached our net debt target of $3.0B this quarter, with no borrowings on our ABL as of today. Given that our CLF shares are still significantly undervalued, we will now re-focus our capital allocation priorities towards more aggressive share buybacks under our existing share repurchase authorization.”