DOW JONES NEWSWIRES
Consolidated Thompson Iron Mines Ltd. (CLM.T) offered to buy the
Wabush Mines joint venture from United States Steel Corp. (X),
ArcelorMittal (MT, MT.AE) and Cliffs Natural Resources Inc. (CLF)
for a total of US$120 million.
The deal will be financed with existing cash and credit
facilities available to the Canadian mining company.
U.S. Steel and ArcelorMittal accepted the offer on the condition
that Cliffs not exercise its right of first refusal to acquire
their interests in the iron-ore producer on the terms offered by
Consolidated. The right of first refusal expires Oct. 19.
If Cliffs does not exercise its right and does not accept
Consolidated's offer, Consolidated will have a binding agreement to
acquire U.S. Steel and ArcelorMittal's collective 73.2% interest in
joint venture for a total of US$87.8 million.
ArcelorMittal, which would receive US$34.28 million, said its
stake in Wabush Mines is no longer a core part of its mining
strategy. The mine represented 31 million tons of iron ore reserve
and 1.2 million tons of iron ore produced for ArcelorMittal in
2008.
Wabush Mines owns and operates iron ore mining and pellet
facilities in Newfoundland and Labrador and Quebec, Canada.
Last year, ArcelorMittal filed a lawsuit in Canada against the
other two owners of Wabush Mines, saying they had reneged on a deal
to let ArcelorMittal buy them out.
-By Kathy Shwiff, Dow Jones Newswires; 212-416-2357;
Kathy.Shwiff@dowjones.com