U.S. Steel (X) shares experienced a significant surge in pre-market trading after the company rejected a $7.3 billion takeover offer from Cleveland-Cliffs. U.S. Steel referred to the bid as an “unreasonable proposal” and stated that Cleveland-Cliffs was unwilling to sign a non-disclosure agreement needed to evaluate the cash-and-shares offer.
Cleveland-Cliffs proposed to pay $32.53 per share for U.S. Steel, consisting of cash and shares of Cleveland-Cliffs stock. This would represent a 43% premium to U.S. Steel’s closing price on Friday and value the steelmaker at around $7.26 billion. However, U.S. Steel insisted on conducting a thorough due diligence process to evaluate the risks and benefits of the transaction before considering the offer.
As a result of this development, U.S. Steel shares rose by 28% in pre-market trading, while Cleveland-Cliffs shares fell by 7%. U.S. Steel closed at $22.72 per share on Friday, reflecting a year-to-date decline of approximately 9.3%. The company’s market value is currently estimated at $5.1 billion.
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