aks steel merger

 tumbled 10.7%, to pare earlier losses of as much as 15.8%. Under the terms of the merger agreement, AK Steel shareholders will receive 0.40 shares of Cliffs common stock for each outstanding share of AK Steel common stock they own. I love looking at the "story" behind investments from an interdisciplinary point of view, with an equal appetite for high-growth disruptors and beaten-down value names. That implies a market capitalization for AK Steel of about $1.06 billion. News AK Steel Renamed Cleveland-Cliffs Effective Immediately Cleveland-Cliffs has undergone significant transformation over the last year, with the acquisition of AK Steel and ArcelorMIttal USA assets. Cleveland-Cliffs is acquiring AK Steel. This website will be transitioning to www.clevelandcliffs.com during Q2 2021. The companies have agreed to enable the merger of a fully-owned Cleveland-Cliffs subsidiary with and into AK Steel. “For Cliffs, we expect to realize immediate growth and a long-desired objective of a more diverse customer base, as well as more predictable cash flow generation due to the contracted nature of AK Steel’s sales of high-end automotive steel,” Goncalves said in a statement. Earlier this week, Cleveland-Cliffs (CLF) announced that it will acquire AK Steel (AKS). On December 3, 2019, AK Steel announced that it had signed an agreement to be acquired by Cleveland-Cliffs for a total of approximately $1.1 billion. AK Steel’s stock has soared 38.7% over the past three months, but has lost 2.6% over the past 12 months, while Cleveland-Cliffs shares have lost 17.8% the past year and the S&P 500 index Under the proposed tax-free merger, expected to close during the third quarter, Armco's common shareholders will receive 0.2836 share of AK Steel common stock for each share they own. At Tuesday’s closing prices, the deal would value AK Steel stock at about $3.00, or 3.8% above Monday’s closing price. You can follow him on Twitter @TomiKilgore. CLF … Acquiring a … Based on Monday’s stock closing prices of $2.89 for AK Steel and $8.41 for Cleveland-Cliffs, the deal values AK Steel shares at $3.36, or a 16% premium. AK Steel shares AK Steel shares ran up 4.7% on Monday and Cleveland-Cliffs’ stock climbed 5.3%. The companies have agreed to enable the merger of a fully-owned Cleveland-Cliffs subsidiary with and into AK Steel. Shares of Plug Power Inc. surged Friday, after they hydrogen and fuel cell systems company completed its restatement, removing a "shroud of uncertainty" that has been weighing heavily on the stock the past couple months. Per the merger agreement, AK Steel shareholders will receive 0.40 shares of Cleveland-Cliffs common stock for each share of AK Steel common stock owned. AKS : 1.55 (unch) CLF : 21.12 (+3.23%) Cleveland-Cliffs Completes Acquisition of AK Steel BusinessWire - Fri Mar 13, 7:35AM CDT. She texted to say she misses our friendship. Regardless of the initial reaction, however, I think this deal could be a good merger for both parties. Iron-ore miner Cleveland-Cliffs Inc. ( NYSE: CLF) announced Tuesday morning that it has entered a definitive merger agreement to acquire AK Steel Holding Corp. ( NYSE: AKS. ) Here's why. Subject to the terms and conditions of the Merger Agreement, Merger Sub will merge with and into AK Steel (the “Merger”) with AK Steel surviving the Merger … As such, the opportunistic acquisition of AK Steel after a huge drop in steel prices could wind up being a savvy value investment for Cleveland-Cliffs, even exclusive of the synergies and vertical integration benefits. Though the company has hedged much of its iron ore prices for 2019, hedging isn't free, and when the hedges roll off, they may become more expensive, should iron ore prices remain high. The merger announcement comes a day after President Donald Trump gave a boost to shares of steel producers, by saying he was bringing back tariffs on steel imports from Brazil and Argentina, as retaliation for currency devaluations. UPDATE 12/3/19 @ 1 p.m. A merger agreement between Cleveland-Cliffs Inc. and AK Steel means Cliffs has acquired all of the issued and outstanding shares of AK Steel … The share exchange rate equals only roughly a 16% premium to AK Steel's stock price from the prior day, given where Cleveland-Cliffs' shares were trading. The total enterprise value of the deal was about $3.0 billion, as AK Steel had $1.97 billion in long-term debt as of Sept. 30. Stockholders of AK Steel will get 0.4 shares of Cleveland-Cliff for each of their shares, worth about $3.36 at Monday’s closing price. Under terms of the deal, which is expected to close in the first half of 2020, AK Steel shareholders will receive 0.40 shares of Cleveland-Cliffs common stock for each AK Steel share they own. “The combination of Cliffs’ iron ore pellet capabilities and our innovative, high-quality steel product development and production is strategically compelling,” AK Steel Chief Executive Roger Newport said. Cleveland-Cliffs Inc. (NYSE: CLF) and AK Steel Holding Corporation (NYSE: AKS) are pleased to announce that they have entered into a definitive merger agreement pursuant to … +1.32% Under the terms of the merger agreement, AK Steel shareholders will receive 0.40 shares of Cliffs common stock for each outstanding share of AK Steel common stock they own, AK Steel said in … AK Steel's stock is down around 80% over the past decade, so the price looks pretty cheap. Cleveland-Cliffs Inc. CLF and AK Steel Holding Corporation AKS recently announced that they have received all of the required regulatory approvals related to their proposed merger deal. As such, the company will become vertically integrated, meaning it will own its own supply of iron ore pellets, which are used to make steel. -1.69% That works out to about $2.95 per AK share, a … Gains were pared, however, as the tumble Cleveland-Cliffs’s stock effectively lowered the buyout bid’s premium to under 4% from about 16%. The company, whose name was derived from the initials of Armco, its predecessor company, and Kawasaki Steel Corporation, was acquired by Cleveland-Cliffs in 2020. Cumulative Growth of a $10,000 Investment in Stock Advisor, Why the Cleveland-Cliffs/AK Steel Merger Makes Tons of Sense @themotleyfool #stocks $CLF $AKS $MT, Why Cleveland-Cliffs Stock Rocketed 10% in Morning Trading Today, Why Cleveland-Cliffs Stock Fell 13% in February, Why Cleveland-Cliffs Stock Plunged 10% in Early Trading Today, Why Cleveland-Cliffs Surged Another 32.2% in December, Why Cleveland Cliffs Surged 33% in November, Copyright, Trademark and Patent Information. Steven Goldstein is based in London and responsible for MarketWatch's coverage of financial markets in Europe, with a particular focus on global macro and commodities. CMTX - Fri Mar 13, 7:35AM CDT. The combined company will be headquartered in Cleveland, but a “significant presence” will be maintained at AK Steel’s current headquarters in West Chester, Ohio. The stock pared earlier gains of as much as 6.9%, while Cleveland-Cliffs’ stock The new company will combine Cleveland-Cliffs' iron ore pellet production capabilities, of which it had about 42% U.S. market share, with AK Steel's blast furnace steel plants and downstream businesses, which make specialized, high-grade steel parts, especially for the auto industry. https://marketrealist.com/2019/12/clf-acquires-aks-marriage-made-heaven These near-term debt maturities were probably weighing on AK Steel's stock price, which had fallen some 70% over the past three years, as opposed to just a 9% decline for Cleveland-Cliffs. AK Steel Chief Executive Roger Newport will retire. Iron ore pellet producer Cleveland-Cliffs is buying flat-rolled carbon, stainless steel and electrical products maker AK Steel for $1.1 billion. Both stocks have been affected by volatile steel prices this year.  has advanced 14.6%. That amounts to a pretty significant 10% of the combined companies' EBITDA (earnings before interest, taxes, depreciation and amortization) over the past 12 months. CLF, However, AK Steel also makes the advanced high-strength steels and ultra-high strength steels that should be in demand for car companies looking to meet the upcoming 2025 U.S. CAFE fuel standards. Cleveland-Cliffs will issue 0.4 shares to shareholders of AK Steel upon closing, which is supposed to occur by the end of the first half of 2020. Image source: Getty Images. But is it a bright and shiny deal for investors? The stock market reacted more positively to … In addition, since iron ore prices have risen this year while steel prices have declined, the transaction also takes away a risk of a reversion to a lower iron ore price. “Although the acquisition is dilutive in share count, we expect [earnings per share] and free cash flow per share accretion in the first full year,” Miller wrote in a note to clients. This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. Don’t miss: Trump brings back tariffs on Brazil and Argentina as deadline for China levies approaches. “This business combination makes great strategic sense because of a more-sustainable integrated model and because [AK Steel’s] debt can now be re-financed at much lower rates,” Miller wrote. In addition to derisking supply and taking some commodity-price risk off the table, the combined companies are set to achieve a fairly substantial $120 million in cost synergies, of which $40 million will come just from duplicative public company filing costs alone. Cleveland-Cliffs Inc. (NYSE: CLF) announced today that it has successfully completed the acquisition of AK Steel Holding Corporation, integrating North America’s largest producer of iron ore pellets downstream into the production of value-added steel and specialty manufactured parts for the automotive industry. We’re motley! As the deal is completed, three existing members of AK Steel’s current board of directors will join Cleveland-Cliffs board, while two current Cleveland-Cliffs board members will step down. What should I do now. Cleveland-Cliffs shareholders will own 68% of the combined company, which will be led by current Cleveland-Cliffs Chairman and Chief Executive Lourenco Goncalves.  rallied 4.2% to $3.01 on Tuesday, the highest close since March 4. Following this, AK Steel will survive the merger as a fully-owned subsidiary of Cleveland-Cliffs. Analyst Matthew Miller at CFRA cut his stock price target for Cleveland-Cliffs to $9 from $4, but reiterated his strong buy rating. Click Here for More Information AK Steel (ticker: AKS) shareholders will receive 0.4 shares of Cleveland-Cliffs (CLF) for each AK share held. A merger agreement announced Tuesday would see AK Steel acquired for $1.1 billion by Cleveland-Cliffs, the largest producer of iron ore pellets in North America. , Inc. All rights reserved industry ’ s 8.3 % rise with into! Mean that even exclusive of synergies, Cleveland-Cliffs may be getting a good deal synergies, Cleveland-Cliffs may getting! Ore prices, as had occurred this year exclusive of synergies, (... Be getting a good merger for both parties, stainless Steel and electrical maker. Steel for $ 1.1 billion under pressure Steel ( ticker: AKS shareholders... Prices this year steelmaking company headquartered in West Chester Township, Butler County, Ohio, AK Steel outsize... Will be somewhat shielded from future spikes in Iron ore pellet producer Cleveland-Cliffs is buying flat-rolled,... 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