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Cleveland-Cliffs Clears Regulatory Hurdle in Stelco Acquisition

By  |  October 9, 2024

Cleveland-Cliffs Inc. has reached a significant milestone in its bid to acquire Stelco Holdings Inc., a Canadian steel manufacturer, by announcing the expiration of the federal waiting period required under the Hart-Scott-Rodino (HSR) Antitrust Improvements Act of 1976. This announcement, made by the Cleveland-based steelmaking giant, indicates that the regulatory hurdle has been successfully cleared, paving the way for the anticipated closing of the acquisition in the fourth quarter of 2024, contingent upon meeting other customary conditions and approvals, according to Cleveland.com.

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    The expiration of the HSR Act waiting period marks a pivotal step in the acquisition process, as the rules governing the act are enforced by the United States Department of Justice. “The expiration of the HSR Act waiting period clears an important regulatory hurdle and marks a significant step toward the closing of this acquisition,” Cleveland-Cliffs stated in a recent communication.

    In a previous announcement, Cleveland-Cliffs revealed that it had amended its $4.75 billion asset-based lending (ABL) facility to facilitate financing for this acquisition, highlighting the company’s commitment to moving forward with the transaction. This amendment represents an early advancement in the overall process.

    Lourenco Goncalves, chair, president, and CEO of Cleveland-Cliffs, expressed enthusiasm about this regulatory approval. “We are excited to secure this critical step in the process and move another step closer toward completing this transformative acquisition of Stelco,” he remarked. He further emphasized that this acquisition would enhance the company’s resilience and geographic diversification in an increasingly competitive global market.

    Cleveland-Cliffs initially announced its intention to acquire Stelco in July, a strategic move that aligns with the company’s broader ambitions in the steel industry. The company remains optimistic about its ongoing bid for the assets of U.S. Steel Corp., based in Pittsburgh, which was unveiled last summer and continues to be a focal point in its expansion plans.

    Source: Cleveland.com