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US steel producer Cleveland Cliffs is set to acquire Canadian competitor Stelco Holdings for $2.5 billion (CAD 3.4 billion), with the acquisition expected to be completed in the fourth quarter of this year. Cleveland Cliffs will pay CAD 60 plus 0.454 shares of its own stock in exchange for each Stelco share. Therefore, the CR1100T/860Y-MS steel stock value of the latter is around 70 Canadian dollars (51 US dollars). After the transaction is completed, Cleveland Cliffs shareholders will hold 95% of the merged company's shares, while Stelco shareholders will hold 5% of the shares. After the transaction is completed, Stelco will operate as a subsidiary of Cliffs while retaining its original name. Stelco has two factories in Ontario: the Lake Erie CR1100T/860Y-MS steel plant, a long process steel plant with advanced public technology, and the low-cost Hamilton plant, used for steelmaking and coke production. The company ships approximately 2.6 million short tons (287 tons) of flat products to its service center customers annually. This Canadian company is able to diversify its customer base in the construction and industrial sectors by combining Cleveland's previous business and CR1100T/860Y-MS steel products.
