By Judy McKinnon
Cliffs Natural Resources Inc. said Thursday that Canadian lender
Bank of Nova Scotia has filed a lawsuit against it, seeking an
award of more than $52 million for alleged breaches of loan
obligations related to the miner's Canadian Bloom Lake iron-ore
mine.
After failing to secure new equity for the Quebec mine,
Cleveland, Ohio-based Cliffs said in January said it would
restructure Bloom Lake under bankruptcy protection, saying the
operation had stopped generating revenue.
A Bank of Nova Scotia spokeswoman wasn't immediately available
to comment on the lawsuit, nor was a spokeswoman for Cliffs.
Cliffs, which announced the lawsuit in an Securities and
Exchange Commission filing, had said late last year it was pursuing
exit options for the mine as falling iron-ore prices made mine
development increasingly costly.
In the filing, Cliffs said the lawsuit was filed by the bank on
Monday in an Ohio court and alleges the miner breached its
obligations under certain equipment loans related to a master loan
and security agreement.
Cliffs said the bank, one of Canada's five-biggest lenders, is
seeking $52.6 million plus interest and expenses. The miner said it
has met its payment obligations under the equipment loans.
Ben Dummett contributed to this article.
Write to Judy McKinnon at judy.mckinnon@wsj.com
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