ASHLAND, Ky. (WSAZ/AP) -- A merger agreement between Cleveland-Cliffs Inc. and AK Steel means Cliffs has acquired all of the issued and outstanding shares of AK Steel common stock.
The company announced Tuesday that they bought out AK for a little more than $1 billion. This announcement comes a little less than a month since the facility made its final coil.
AK officials say the merger will combine with Cliffs to create a vertically integrated producer of value-added iron ore and steel products.
Cliffs is North America's largest producer of iron ore pellets, and AK officials say with the companies combined, they will be "ideally positioned to provide high-value iron ore and steel solutions to customers primarily across North America."
According to a release, one of the strategic and financial benefits of the merger could bring new life to AK's now idle Ashland location.
"The combined company will ensure pellet volume commitments to AK Steel's blast furnaces along with Cliffs' Toledo hot briquetted iron facility, to complement its existing long-term minimum volume pellet offtake agreements with other key integrated steel producers. Further, the potential startup of pig iron manufacturing at AK Steel's facility in Ashland, Kentucky would create future opportunities for pellet demand and more metallics products without significant additional capital expenditures," the release states.
The transaction is expected to close in the first half of 2020.