CCI Shareholder Harbinger Opposes Alpha Natural Resources Deal
July 21, 08 by TheFleetIf you're new here, you may want to subscribe to our RSS feed. Thanks for visiting!
Related: Cleveland-Cliffs shareholder unhappy with Alpha deal - Reuters UK
By Yana Morris and Michael Ross | Source: FT.com/dealReporter
Prior to announcing a sale to Cleveland-Cliffs (CLF) on Wednesday, Alpha Natural Resources (ANR) had been holding informal discussions with two foreign companies since the beginning of the year, a source close to the deal, but not close to the foreign companies, told dealReporter. ArcelorMittal was understood to be one of these companies.
On Thursday Harbinger Capital Partners, Cleveland-Cliffs’ largest shareholder with a 18.36% stake, announced it was opposed to the deal.
Given the two-thirds vote needed from Cleveland-Cliffs shareholders to approve the deal, Harbinger may have a good chance of swaying an outcome.
A long-term ANR shareholder commented that CLF’s price was insufficient. It was his opinion that ANR’s consensus numbers underestimate the company’s true potential, and that the target would be getting the short end of the stick if the deal with CLF is culminated.
Whether the deal goes through or not, the source contended that the greater issue at hand is the destiny of CLF, given the stringent conditions to the closing of its ANR purchase and the fact that its line of business is in hot demand for global steel producers.
