Iron-ore mining company Cleveland-Cliffs has acquired the U.S. assets of ArcelorMittal, the world’s largest steelmaker, for $1.4 billion in cash and stock, the companies announced Monday.
The acquisition means Cleveland-Cliffs will become the largest flat-rolled steel producer in the country, and the largest producer of iron-ore pellets, the company said.
The deal comes just months after Cleveland-Cliffs purchased AK Steel Holding Corp. for $1.1 billion in stock.
Cleveland-Cliffs’ history dates back to 1847. The company supplies iron ore pellets to the North American steel industry from its mines and pellet plants in Michigan and Minnesota.
ArcelorMittal said in statements that it expects to take in $1.4 billion, with about a third of that, or $505 million, in upfront cash.
The company said that Cleveland-Cliffs also would take on the liabilities of ArcelorMittal USA, including pensions at $1.5 billion.
ArcelorMittal is the world’s largest producer of steel. Its U.S. subsidiary has about 18,000 employees across the country, the company said.
The deal involves 25 facilities in the United States, including steel-making facilities and mines.
In a statement Monday, Lourenco Goncalves, chairman, president and CEO of Cleveland-Cliffs, said: “Steelmaking is a business where production volume, operational diversification, dilution of fixed costs, and technical expertise matter above all else, and this transaction achieves all of these.”
The companies have long had a supply relationship.