Cleveland-Cliffs Triples Down on America
The American steel industry has been through a rough patch for most of the past decade, with the exception of 2018, when the passage of the Tax Cuts and Jobs Act along with steel tariffs boosted U.S. steel prices for a bit. However, the party didn't last long, as oversupply and the U.S.-China trade war plunged the industry into a recession soon after. The big steel bust in late 2018 and 2019 has continued into 2020 with the COVID-19 crisis.
However, U.S. iron ore producer, and now integrated steelmaker, Cleveland-Cliffs (NYSE: CLF), is betting big on a turnaround. After buying AK Steel Holding back in late 2019, Cleveland-Cliffs just inked its second large acquisition within a year, agreeing to buy the U.S. operations of ArcelorMittal (NYSE: MT) in a cash-and-stock deal that will create the largest flat-rolled integrated steel producer in the U.S.
Here's the rationale behind the acquisition, and what CEO Lourenco Goncalves sees as the future of the U.S. steel industry.
Source Fool.com
