CLEVELAND (AP) — Cleveland-Cliffs will buy AK Steel in a stock deal valued at about $1.1 billion.
The companies say the tie-up will create a vertically integrated company that pairs Cleveland-Cliff’s iron ore pellet production with AK Steel’s rolled and stainless
Cleveland-Cliffs is the largest producer of iron ore pellets in North America.
After a brief spike in prices, U.S. steel producers have struggled since the Trump administration put a 25% steel tariff into place last year. Domestic demand has slumped as oil and gas drillers pull back on purchases of steel pipe, with prices for natural gas tumbling 45% over the past 12 months.
U.S. Steel in its last quarter reported its first loss since early 2017, and the division that makes pipes for energy companies lost $25 million. It has laid off workers and shut down some of its blast furnaces.