United States Steel Corporation (NYSE:X) has allowed Cleveland-Cliffs Inc. (NYSE:CLF) to participate in its sale process after agreeing to the terms of a nondisclosure agreement (NDA), a person familiar with the matter said on September 28, 2023. Reuters reported last week that a disagreement over the NDA had kept Cliffs out of a bidding process that U.S. Steel announced on Aug. 13.
U.S. Steel had failed to convince Cliffs to sign a six-month standstill agreement that would prevent the latter from challenging U.S. Steel?s board of directors. Cliffs and U.S. Steel have now agreed to an NDA that comes with a two-month standstill, the source said. Reuters has reported that Cliffs has secured bank financing for its bid that is not subject to due diligence.
Signing the NDA, however, will give Cliffs, whose previous $7.1 billion cash-and-stock offer for U.S. Steel was rebuffed, visibility into the bidding process. The source requested anonymity because the matter is confidential. U.S. Steel and Cliffs did not immediately respond to requests for comment.
CNBC first reported on the NDA earlier on September 28, 2023. Reuters has reported that ArcelorMittal S.A. (ENXTAM:MT) is one of the parties that has been working on a potential bid for U.S. Steel. Bloomberg News has also reported that Canadian steelmaker Stelco Holdings Inc. (TSX:STLC) is pursuing a bid for U.S. Steel, though it is unclear how a company with a CAD 2 billion market value ($1.5 billion) would find the resources to compete.