Cleveland Cliffs is a partner with a rival Nucor in a potential bid for US Steelwhose takeover by Japan’s Nippon Steel was blocked by the White House earlier this month, sources told CNBC David Faber.
Cleveland-Cliffs will buy all of US Steel for all the cash, then sell the Big River Steel subsidiary to Nucora, the sources said. Under the deal, US Steel’s headquarters would remain in Pittsburgh.
The offer would be in the high stakes of $30. Nippon planned to buy US Steel for $55 a share in a deal valued at more than $14 billion.
Shares of US Steel jumped more than 8% to $37.15 a share on Monday. CNBC has reached out to the companies for comment.
Over the weekend, the White House extended the deadline for Nippon to permanently end its pursuit of US Steel until June while the companies pursue a lawsuit in federal court against the president Joe Biden‘with the decision to block the job.
US Steel and Nippon also filed a separate lawsuit against Cleveland-Cliffs, its CEO, Lorenzo Goncalves, and United Steelworkers President David McCall, alleging they colluded to block the deal. Shares of Cleveland-Cliffs and Nucor rose about 3% on Monday.
Goncalves dismissed the lawsuit as “a shameless attempt to scapegoat others for the self-inflicted disaster of US Steel and Nippon Steel.”
Biden’s decision to block the sale followed a review by the Committee on Foreign Investment in the United States, but the president has made clear for months that he believes US Steel should remain an American-owned company.
Biden cited national security concerns in his Jan. 3 decision, saying a strong domestic steel industry is critical to U.S. supply chains. US Steel and Nippon argued that the deal was in the best interests of workers and national security by strengthening the steel industry in the face of threats from China.
US Steel CEO David Burritt called on the president-elect Donald Trump will change Biden’s decision to block the sale when he takes office later this month. Trump also opposed Nippon’s takeover of US Steel.
US Steel closed at $34.24 per share on Friday.