Twitter

Cliffs Natural Resources

Iron ore market risks ‘disaster’ – by DOW JONES NEWSWIRES WITH A STAFF REPORTER (The Australian – September 8, 2014)

http://www.theaustralian.com.au/business

Mining companies will aggressively pursue increased output in the face of continuing weakness in the iron ore price, though with forecast demand not expected to keep pace with production, one analyst is warnings of a potential “disaster”.

Rio Tinto and BHP Billiton in Australia, and Vale in South America — the world’s top three iron ore miners — are ramping up production in a bet that their enormous efficiencies of scale will allow them to profit, even though prices are now less than half what they were four years ago. The companies are also betting that the lower prices could force higher-cost competitors out of the market, giving them more pricing power in the long run.

The iron ore price has been in a slump for most of the year, with its latest fall on Friday seeing a new five-year low at $US83.60 a tonne.

Already Cliffs Natural Resources has hired bankers to sell its mines in Australia because it has difficulty competing with the major players. “The big three are in control, and there’s not much you can do about it,” Lourenco Goncalves, chief executive of the Cleveland-based company, said in an interview.

The developments are being closely watched by steelmakers in China, South Korea and Japan, the world’s top three importers of iron ore, the key ingredient in making steel. Should the big players, which account for more than 60 per cent of all seaborne trade of the mineral, tighten their control of the market, they could exert greater pressure during price negotiations.

Read more

Other players active in Ring – by Thunder Bay Chronicle-Journal (August 10, 2014)

Thunder Bay Chronicle-Journal is the daily newspaper of Northwestern Ontario.

WHAT a difference a year makes. In 2013, Northwestern Ontario communities were giddy at the prospect of getting in on the tremendous economic opportunities connected to the Ring of Fire mining belt. Thunder Bay and Sudbury were fiercely competing to be the site of a processing facility while Greenstone and other centres were pitching themselves as logical transportation hubs.

Then the big player walked away. For a variety of reasons — provincial indecision, First Nations objections, competitors’ alternatives, falling commodity and stock prices — Cliffs Natural Resources ended its substantial exploration activities. A coup of sorts among shareholders put in place a new CEO who agreed to return Cliffs’ attention to its iron ore business which Thunder Bay area residents can see when they drive through northern Minnesota.

While Cliffs hasn’t abandoned its stake in the Ring’s massive chromite deposit other companies that remain active in the region are now getting all the attention.

Noront Resources has its eye on the region’s rich nickel deposits and has promoted an east-west transportation route linking mine sites with the CN main line and running past several First Nations which would stand to enjoy direct employment opportunities along with economic partnerships.

Read more

NEWS RELEASE: Lourenco Goncalves Appointed Chairman, President and Chief Executive Officer of Cliffs Natural Resources Inc.

CLEVELAND – Aug. 7, 2014 – Cliffs Natural Resources Inc. CLF -1.23% today announced that the Company’s Board of Directors has appointed Lourenco Goncalves to the positions of Chairman, President and Chief Executive Officer, effective immediately.

“I am honored by the opportunity to lead Cliffs into its next chapter, with a keen focus on improving performance and restoring shareholder value,” said Mr. Goncalves. “Cliffs has a unique position of strength in iron ore in the Great Lakes region, many valuable assets in other sectors elsewhere in the US and around the world, and talented employees at all levels of the company.

I look forward to working closely with all of my fellow Directors to refocus Cliffs on a new strategic path that builds on those strengths, and I am grateful to my fellow shareholders for the vote of confidence they have placed in us. While there is much to be done and many challenges ahead of us, there is also much promise. I can assure all of our stakeholders we are hitting the ground running.”

Mr. Goncalves replaces Jim Kirsch who served as Chairman since July 2013, and Gary Halverson who served as CEO since February 2014.

Richard K. Riederer, who has been a Director of the Company since 2002 and was re-elected at this year’s Annual Meeting, added, “I look forward to working with the new Board and management team. The Company wishes to thank Gary Halverson for his contributions to Cliffs as CEO. We also extend our thanks to Jim Kirsch for his service as Chairman of our Board and wish him well in his future endeavors.”

Read more

AUDIO: Ring of Fire ‘soap opera’ continues with recent court ruling (CBC News – August 05, 2014)

 http://www.cbc.ca/news/canada/sudbury

A mining industry observer says a recent court ruling will do nothing to spur development in the Ring of Fire. A divisional court ruled last week that Cliffs Natural Resources may apply to the province to build a road over KWG Resources’ land. KWG had been withholding its consent.

Cliffs has said it wants to build a road to transport ore from the Ring of Fire in the Northwest. In an interview last week, Cliffs vice-president Bill Boor said the decision was reason for optimism for Sudburians.

The company has floated the idea of a chromite smelter in Capreol. But the head of the Sudbury Area Mining Supply and Services Association said Cliffs still has to satisfy the minister, negotiate with Aboriginal groups and complete environmental assessments.

“If it’s a good step, I’m not sure for whom,” Dick Destefano said. “But it seems to open up another avenue for discussion — which means another delay and another discussion, and another study.”

He noted there are so many variables that the opportunities around the project could easily vanish. “This is like the Wizard of Oz for me,” Dick Destefano said.

Read more

Cliffs wins key court battle – by Staff  (Sudbury Star – August 6, 2014)

The Sudbury Star is the City of Greater Sudbury’s daily newspaper.

The company that once planned to build a $1.8-billion chromite plant in Capreol has won a key court battle. Last week, an Ontario Divisional Court set aside a decision reached by the Ontario Mining and Lands Commissioner in September 2013. In that decision, the lands commissioner denied Cliffs Natural Resources an easement for a road to reach its Black Thor chromite deposit in the so-called Ring of Fire area of northwestern Ontario.

Cleveland-based Cliffs wanted the easement, even though the land is owned by rival KWG Resources. Cliffs, which has halted all exploration on its chromite project, launched the appeal in October. The case was heard in Toronto in June.

The court’s decision means that Natural Resources Minister Bill Mauro will now decide if Cliffs gets the OK for a road into the Ring of Fire.

“Whether or not it is in the public interest to grant an easement for a road is a matter for the minister of natural resources to determine, after an environmental assessment and consultation with First Nations and other affected interests,” the court ruled. “It is for the minister to determine whether the easement should be granted in the public interest and on what terms.”

Cliffs wants to stake a 330-kilometre long corridor using mining claims from Nakina north to the exploration camps in the James Bay lowlands.

Read more

Boardroom coup likely to see Cliffs on the selling block – by Peter Kerr (Sydney Morning Herald – August 5, 2014)

http://www.smh.com.au/

The miner at the centre of a $US2.65 billion ($2.84 billion) boardroom coup has conceded it will probably fall under the control of an activist hedge fund intent on breaking up its structure and selling its assets.

In a transition that is expected to put the fifth biggest iron ore export business in Australia on the selling block, Cliffs Natural Resources said overnight that hedge fund Casablanca Capital was expected to control six seats on the company’s 11-member board.

”The election of individual director candidates is not yet complete,” Cliffs said in a filing to market regulators in the US. ”However, based on the preliminary voting results, all six of the Casablanca Nominees and five of the Board Nominees have been elected for a term that will expire on the date of the 2015 annual meeting of shareholders.”

The comments support claims by Casablanca immediately after last week’s annual meeting of Cliffs’ shareholders, when the hedge fund claimed to have won control of the miner after a long campaign seeking higher dividends and asset sales.

Cliffs owns coal and iron ore assets across several locations in the US, Canada and Australia, including an iron ore export business in Western Australia.

That business, known as the Koolyanobbing operations, is profitable and exports about 11 million tonnes of iron ore a year through the port of Esperance.

Read more

Cliffs’ boardroom shake-up presents buying opportunities for Canadian miners – by Peter Koven (National Post -August 5, 2014)

The National Post is Canada’s second largest national paper.

A boardroom shake-up at Cliffs Natural Resources Inc. has raised the likelihood that its international assets will hit the market, creating some intriguing buying opportunities for Canadian miners in their own backyard.

These assets include a large but troubled iron ore mine in Quebec, and a huge chromite deposit in Northern Ontario’s “Ring of Fire” that one company has already expressed interest in buying.

Cleveland-based Cliffs has been engaged in a vicious proxy war with hedge fund Casablanca Capital LP for the past six months. That battle ended in an apparently decisive victory for Casablanca last week, as the New York-based activist fund said it claimed six of the 11 seats on Cliffs’ board. Cliffs has not yet confirmed the final numbers.

Casablanca has been very open about its plans for Cliffs: It wants the company to focus on its core U.S. iron ore operations and look at divesting everything else, including assets in Canada and Australia.

The fund had plenty of shareholder support for this strategy, because Cliffs’ recent international forays have simply not worked out. In Canada, the company spent a staggering $4.9-billion in cash to buy the Bloom Lake iron ore mine in the 2011 takeover of Consolidated Thompson Iron Mines Ltd.

Read more

NEWS RELEASE: Cliffs Natural Resources Inc. Announces Results of Annual General Meeting of Shareholders

Aug 05, 2014

CLEVELAND – Aug. 5, 2014 – Cliffs Natural Resources Inc. (NYSE: CLF) today announced that, based upon the preliminary report of the Inspector of Elections, IVS Associates, Inc., five Cliffs’ directors have been re-elected to the Board – Mark E. Gaumond, Gary B. Halverson, Janice K. Henry, Richard K. Riederer and Timothy W. Sullivan. The preliminary report also indicates that they will be joined by six newly elected directors, Lourenco Goncalves, Robert P. Fisher, Jr., Joseph Rutkowski, James Sawyer, Gabriel Stoliar and Douglas Taylor. The Cliffs Board will not contest the preliminary voting results and, as such, these results will be final once certified by the inspector of elections.

Cliffs issued the following statement:

“Over the past several months, a number of different perspectives were conveyed and our shareholders had the chance to express their views on a variety of points. We appreciate the consideration and support of our shareholders, as well as the valuable insights they have offered our Board and management team throughout this process. We welcome our new directors to the Board and look forward to working with them.

We would like to thank Susan M. Cunningham, Barry J. Eldridge, Andrés R. Gluski, Susan M. Green, James F. Kirsch and Stephen Johnson for their service on Cliffs’ Board of Directors and their many contributions to the Company.”

Cliffs noted that the voting results also indicated that shareholders approved all of the other proposals submitted for a vote at the Annual General Meeting. As previously announced, the newly constituted Cliffs’ Board will elect a new Chairman as soon as practicable.

Read more

Cliffs wins victory in Ring of Fire court case – by Sudbury Northern Life Staff (August 1, 2014)

http://www.northernlife.ca/

It’ll be up to Natural Resources Minister Bill Mauro to decide if Cliffs Natural Resources gets permission for an overland transportation route into the Ring of Fire.

On July 29, an Ontario Divisional Court set aside a decision reached by the Ontario Mining and Lands Commissioner last September that denied Cliffs an easement for a road to reach its Black Thor chromite deposit atop the mining claims of a rival company, KWG Resources.

Cliffs, which has halted all exploration on its chromite project, launched the appeal last October. The case was heard in Toronto, June 16-17.

The bone of contention with Cliffs has been over the use of surface rights by KWG to stake a 330-kilometre long corridor using mining claims from Nakina north to the exploration camps in the James Bay lowlands.

Cliffs contended that KWG was holding other mining companies hostage by blocking a critical path into the region. KWG, through its Canada Chrome subsidiary, wants to use the corridor for a future railroad.

KWG also has a 30-per-cent stake in the Big Daddy chromite deposit that it shares in an adversarial relationship with Cliffs.

Read more

Cliffs and Casablanca – the start of a beautiful friendship? – by Northern Miner Editorial (July 30, 2014)

The Northern Miner, first published in 1915, during the Cobalt Silver Rush, is considered Canada’s leading authority on the mining industry.

It’s the biggest shareholder revolt of the current downturn in mining, but as we go to press it looks like Casablanca Capital has succeeded fulsomely in its long-shot bid to swamp the 11-member board of Cliffs Natural Resources with six of its own nominees.

Cleveland-based Cliffs is a major producer of iron ore and metallurgical coal worldwide, but its share price has suffered in the past three years owing to a combination of low iron ore and coal prices, and overexpansions into such ill-fated projects as its chromite project in Ontario’s Ring of Fire region.

Earlier this year, Cliffs idled its high-cost Wabush iron ore mine in Labrador and suspended an expansion of its Bloom Lake iron ore mine in Quebec, and is now set to idle its Pinnacle coal mine in West Virginia for more than six months starting in late August.

In the lead-up to the vote, Cliffs woes showed in its second-quarter net loss of US$2 million on revenues of US$1 billion. That compares with net earnings of US$133.1 million, or US82¢ per share, on revenues of $1.4 billion in the same quarter of 2013.

Based in New York and founded in 2010 by Donald G. Drapkin and Douglas Taylor, Casablanca Capital describes itself as an “event-driven and activist investment manager.”

Read more

The end of Cliffs in the Ring of Fire? – by Ian Ross (Northern Ontario Business – July 29, 2014)

Established in 1980, Northern Ontario Business provides Canadians and international investors with relevant, current and insightful editorial content and business news information about Ontario’s vibrant and resource-rich North. Ian Ross is the editor of Northern Ontario Business ianross@nob.on.ca.

A New York hedge fund proclaims it’s won a bitter proxy fight with Cliffs Natural Resources to achieve majority control of the Ohio iron ore and coal miner’s board of directors. Casablanca Capital said it was successful in convincing Cliffs’ shareholders to elect all six of its nominees at the miner’s annual general meeting in Cleveland, July 29.

The final results are subject to independent inspection over the next three days. If Casablanca is right, it means Cliffs’ hold on its Ring of Fire chromite properties in the James Bay region is tenuous at best.

Casablanca, which acquired 5.2 per cent of Cliffs’ shares, wants to break off Cliffs’ international assets, including its Ring of Fire properties, from its core U.S. iron and coal divisions.

“We are grateful to our fellow Cliffs shareholders for their careful consideration of the issues and gratified that they have sent a resounding message of support for our efforts to drive meaningful change at Cliffs, bring true accountability to the company’s leadership, and restore shareholder value,” said Casablanca fund chairman Donald Drapkin in a statement.

Read more

UPDATE 2-Hedge fund triumphs in proxy battle with U.S.-based miner Cliffs – by Kim Palmer (Reuters U.K. – July 29, 2014)

http://uk.reuters.com/

(Rewrites throughout with details from meeting, analyst view, background)

(Reuters) – Casablanca Capital triumphed on Tuesday in its proxy battle with miner Cliffs Natural Resources Inc, preliminary estimates show, putting the hedge fund in a position to replace Cliffs’ chief executive and sell off underperforming assets.

Shareholders of Cleveland-based Cliffs voted onto the miner’s board all six nominees put forward by Casablanca, the New York-based fund said, citing estimates from its proxy solicitor. That means they will make up a majority of the 11-person board.

Cliffs CEO Gary Halverson said at the company’s well-attended annual meeting in Cleveland that because of the contested nature of the elections, the results would be announced in the next three business days.

Shares in Cliffs, a producer of iron ore and metallurgical coal, jumped as much as 10.4 percent to $18.33 on the New York Stock Exchange. The vote outcome “is a culmination of years of frustration on behalf of shareholders,” said Garrett Nelson, a mining research analyst at BB&T Capital Markets.

Casablanca began a proxy fight in March against Cliffs, of which it owns 5.2 percent, accusing the miner of destroying shareholder value through an ill-conceived expansion strategy.

Read more

NEWS RELEASE: CLIFFS NATURAL RESOURCES INC. ISSUES STATEMENT

CLEVELAND – July 29, 2014 – Cliffs Natural Resources Inc. (NYSE: CLF) today made the following statement following the Company’s Annual General Meeting:

“We look forward to receiving the final results of today’s vote, and the Board and management team remain deeply committed to continuing to create long-term value for all of our shareholders. We appreciate the support of the Cliffs shareholders who supported the Company’s slate and the hard work everyday by Cliffs’ more than 6,000 employees.”

The Company will await the preliminary report of the Inspector of Election, IVS Associates, Inc., before releasing any further statements about the vote. The Inspector has indicated that it expects to issue a preliminary tabulation of the vote results within approximately three business days, which Cliffs will publicly announce. Final results of the election will also be announced once they are certified by the Inspector of Election following the customary review and challenge period.

About Cliffs Natural Resources Inc.

Cliffs Natural Resources Inc. is an international mining and natural resources company. The Company is a major global iron ore producer and a significant producer of high-and low-volatile metallurgical coal. Cliffs’ strategy is to continually achieve greater scale and diversification in the mining industry through a focus on serving the world’s largest and fastest growing steel markets. Driven by the core values of social, environmental and capital stewardship, Cliffs associates across the globe endeavor to provide all stakeholders operating and financial transparency.

Read more

PRESS RELEASE: Casablanca Receives Overwhelming Shareholder Support for Change at Cliffs Natural Resources

July 29, 2014, 12:31 p.m. EDT

All Six Nominees on Casablanca’s Majority Slate Elected to Cliffs Board of Directors According to Preliminary Voting Results

NEW YORK, Jul 29, 2014 (BUSINESS WIRE) — Casablanca Capital LP, (“Casablanca”) the beneficial owner of approximately 5.2% of Cliffs Natural Resources (“Cliffs”) shares, announced today that all six of Casablanca’s nominees have been elected to the Cliffs Board of Directors according to preliminary estimates by its proxy solicitor of the voting results at today’s Annual Meeting of Shareholders.

Donald Drapkin, Chairman of Casablanca, said, “We are grateful to our fellow Cliffs shareholders for their careful consideration of the issues and gratified that they have sent a resounding message of support for our efforts to drive meaningful change at Cliffs, bring true accountability to the Company’s leadership, and restore shareholder value.”

Lourenco Goncalves, one of the Casablanca nominees who was elected, said on behalf of all the newly-elected Casablanca nominees, “The conclusion of this proxy contest marks not an end but a beginning. We look forward to working collaboratively with the continuing members of Cliffs’ Board and the Company’s hardworking, dedicated and talented employees to set Cliffs on a course to improve performance and restore shareholder value. Cliffs has tremendous inherent value and we are confident there is much we can and will do to refocus Cliffs and steer it in a new strategic direction.”

In addition to Goncalves, the other Casablanca nominees newly-elected to the Board are Robert P. Fisher, Jr., Joseph Rutkowski, James Sawyer, Gabriel Stoliar, and Douglas Taylor.

Read more

Cliffs fights for its life against hedge fund – by John Myers (Duluth News Tribune – July 28, 2014)

http://www.duluthnewstribune.com/

The view from Cliffs Natural Resources’ Minnesota operations looks pretty good.

One of the state’s largest players in the taconite iron ore business, the company’s Northshore Mining, United Taconite and Hibbing Taconite plants are running near capacity with solid domestic markets and long-term contracts with U.S. steelmakers.

The company has more than 1,850 employees on the Iron Range with a payroll of $251 million.

There even was good news from Michigan’s Upper Peninsula this year when Cliffs announced its Empire taconite operations wouldn’t close after all, with a new contract for its ore keeping it running into 2017.

Even after weathering a cold spring and slow start to the shipping season, the company expects to produce about 22 million tons of taconite in the U.S. this year, up from 21 million tons last year. Northshore Mining is back to near full capacity after a temporary slowdown in 2013.

But on a global scale the view is less rosy. The Cleveland-based mining company is fighting for its life, with the decisive battle set for Tuesday. That’s when Cliffs will hold its annual shareholder meeting and election of corporate officers, and it’s when New York-based hedge fund Casablanca Capital will make its play to take over Cliffs.

Casablanca in January announced that it wanted to take control of Cliffs, saying the company was overextended overseas and was spending too much money on new projects.

Read more