DOW JONES NEWSWIRES
Cliffs Natural Resources Inc. (CLF) announced it will exercise
its right of first refusal to purchase the 73% stake in a joint
venture with United States Steel Corp. (X) and ArcelorMittal SA
(MT, MT.AE) for $88 million.
Cliffs shares rose 1.5% to $36.06.
The announcement comes three days after Consolidated Thompson
Iron Mines Ltd. (CLMZF, CLM.T) offered to buy the Wabush Mines
joint venture from the three owners for $120 million. U.S. Steel
and ArcelorMittal accepted the offer on the condition that Cliffs
not exercise its right of first refusal.
ArcelorMittal said Friday its 29% stake in the venture was no
longer a core part of its mining strategy. Last year, the company
filed a lawsuit in Canada against Cliffs and U.S. Steel, saying
they had reneged on a deal to let ArcelorMittal buy them out.
Wabush Mines owns and operates iron ore mining and pellet
facilities in Newfoundland, Labrador and Quebec, Canada. By owning
all of the venture, Cliffs said its annual North American iron-ore
production capacity will increase some 4 million tons. Cliffs has
projected 2009 sales in the region of about 16 million long tons.
There are some 75 million tons of proven reserves at Wabush
Mines.
-By Kevin Kingsbury; Dow Jones Newswires; 201-938-2136;
kevin.kingsbury@dowjones.com