28 Sept 2020capital raising announcement● NeutralMajor
Cleveland-Cliffs agreed on Sept 28, 2020 to buy substantially all of ArcelorMittal USA from ArcelorMittal S.A. for about $1.4 billion: $505 million in cash, 78,186,671 new common shares, and 583,273 shares of a new Series B Participating Redeemable Preferred Stock. This follows the AK Steel merger earlier in 2020 and, if completed, adds a second steelmaker; existing shareholders would be diluted by the new shares, and the new preferred ranks ahead of common shares on dividends and liquidation. Closing still needs regulatory approvals (including Hart-Scott-Rodino) and the deal can be ended if not completed by June 28, 2021 (extendable up to three months). The filing also says the company removed its old 7.00% Series A Mandatory Convertible Preferred from its articles because none remained outstanding, and consolidated its articles into a Fourth Amended Articles.