The mineral lease got cancelled by the state, so it is not an asset in bankruptcy court. The State of Minnesota can issue the minerals lease to whomever it would like.
The final nail in the coffin for Essar. The Essar people were a bunch of idiots and the CLF CEO called it that way from the start. No one on Wall Street believed the CLF CEO. He had this whole thing figured out well 18 months ago.
here is what the resident idiot ohtaegun posted when CLF shares were $3 on May 27th...
support weak - resistance strong
by ohtaegun • May 27, 2016 9:06 AM Flag
signs of a weak stock w/ no support.
his cuts thru support like a hot knife, but resistance is like a brick wall.
I wonder where the fruitcake poster ohtaegon disappeared to. Probably back to his trailer home. That guy was such a loser.
And solarmanmike? He must have violated his parole and be back in prison.
Can you imagine that the Macquarie guy bails out on CLF at about $1.35 (after shares collapse form +$100) and then as soon as he reduces his rating to "neutral", the share price quadruples.
Mar-11-16 Initiated Credit Suisse Underperform
Feb-05-16 Reiterated Deutsche Bank Sell $1.50 → $1
Jan-08-16 Downgrade Macquarie Outperform → Neutral
Who can remember the last time CLF raised guidance like this. The are reopening one of its closed mines months head of schedule to meet demand from US Steel Canada, a new customer who will now buy ALL of its iron ore from CLF (as its formerly captive supplier of iron ore, US Steel, is now a competitor).
This is significant news for sure. To land a major new customer with large volumes in a market that is well established and where supplier relationships are hard to change is a big deal. I have to hand it to the CLF CEO. This is the tip of the iceberg. Other steel customers are going to go with CLF more and more as CLF is making all the right moves.
The news release also said that CLF is seeing strong demand from its other customers, but the company did not increase guidance because of this. To me, that means that there will be further meaningful increases in guidance over the next twelve months.
CLF shares should be up 15% on this news.
good posts from other contributors... so let's add them to the list...
15. Huge rebound in the prices for CLF bonds, especially the 2018 bonds which have increased from $0.18 to $0.90 on the dollar of principal.
16. Large insider buys of stock from CEO.
17. Sale of 100% of Casablanca's 7% position in CLF, removing a big overhang.
18. New investor Bob Connell purchases a massive 11% stake in CLF.
19. Global Iron Ore Industry Association names CLF CEO as the most influential executive in the industry for 2016.
1. CLF reduces debt load meaningfully through repayments and bond repurchases.
2. Bloom Lake eliminated and total company bankruptcy averted.
3. Potential new competitor Essar Minnesota fails.
4. Essar Canada put into bankruptcy and CLF resigns them as a customer under new ownership as Essar of India bails out on North America and retreats to India with its tail between its legs.
5. Costs to produce iron ore and pellets reduced dramatically in every operation.
6. Management sells off virtually all non-core assets as promised.
7. US places massive duties on foreign dumped steel and demand and prices for US made steel rise dramatically.
8. CLF reopens closed mines.
9. CLF lands US Steel Canada as a new customer.
10. CLF working diligently on setting up DRI pellet operation. Test volumes manufactured and delivered to clients.
11. CLF signs a new 10-year contract with its largest customer, replacing contracts that were expiring in late 2016 and early 2017.
12. Price for seaborne iron ore well up off the bottom prices.
13. CLF shares are unchanged over the past 12 months, although 2 year chart shows a massive bottom base and upside breakout off the bottom.
14. World's largest iron ore pellet plant (Samarco) closes down removing 20% of the pellet supply from the world markets in one fell swoop. The plant, if it can reopen, will operate at most at 50% for several years.
What is not to like about this situation.
$30 million is a nice chunk of change and certainly helps the cash balance. This is a solid move for CLF as these assets are not core to the company's business. The are electric utility type assets, and thus CLF has an electric utility buyer for them. Another solid move by the CEO.
CLEVELAND, May 20, 2016 /PRNewswire/ -- Cliffs Natural Resources Inc. (CLF) announced today it took top honors at the fourth Annual Platts Global Metals Award for the Industry Leadership Award for Raw Materials & Mining. Cliffs Natural Resources and its leadership were recognized for its strategic vision and strong operating performance. The winners were announced last night during the Global Metals Awards ceremony in London, England.
Lourenco Goncalves said, "It is a tremendous honor to be selected and recognized by Platts as the top mining company within the metals industry. There is no real company without an effective strategy, and no strategy without execution. I want to thank my senior executive management team, and all Cliffs' employees for their great execution and great commitment with our company."
The "Industry Leadership Award" honors a company that has taken decisive action resulting in a substantial transformation or change of direction in their sector of the metals industry. Leadership, market expansion, corporate integrity and financial success are the core characteristics these categories celebrate. In addition, they praised the "strong culture of safety" that allowed Cliffs to maintain -- even improve -- its record of outperforming industry peers in safety metrics.
Judges noted how, under the leadership of CEO Lourenco Goncalves, Cliffs was able to sidestep the issues associated with shrinking steel demand in China by electing to withdraw from the volatile seaborne iron ore market and make a strategic shift to focus on its US iron ore business, taking advantage of the opportunities for growth in supplying steelmakers with higher grade direct-reduced iron. Judges hailed Cliffs as "prescient" and commended the Company's Board of Directors for hiring Mr. Goncalves, "a man who could make tough decisions" to set a new standard for his industry.
This post is dishonest as it does not represent the full picture at all. Note how the author cites Vale's S11D and the Roy Hill project (Roy Hill's production has already been sold in the marketplace so there is nothing there that the market has not factored in already), but totally fails to mention the complete long term shutdown of Vale and BHP's Samarco mine, one of the largest in the world and representing 20% of the worldwide supply of iron ore pellets.
Demand and price fundamentals at CLF are improving dramatically. Foreign imports of steel are down sharply as the duties have put the hammer down on foreign steel dumping into the US. Steel prices, especially hot rolled, are up significantly and this is great for CLF's iron ore prices. Monthly shipments of iron ore on the Great Lakes are up sharply. Essar Minnesota is dead. CLF has resumed shipping to Essar Algoma and will be at full volumes with that customer for all of calendar year 2017. CLF has also added US Steel Canada as a customer. So in summary, volumes are rising, prices are rising and new customers have been gained. That is a great situation.
The other awesome news is that Essar Algoma will be returning to pull purchase volumes from CLF in 2017. It will not be "reduced" volumes from the prior full year levels of 2015. That is several million tonnes.
This is a great sign.
1. CEO has confidence to put his own money to work in buying shares.
2. He clearly knows that bankruptcy is not in the cards for CLF.
3. He believes that the shares of CLF are greatly undervalued.
4. He knows that there is no way to figure out where CLF shares will trade in the next day, week or month, but clearly the CEO believes that the shares are worth significantly more than their current price.
Cliffs Natural Resources Inc. (NYSE:CLF) kept in active run as it closed at $3.02 by felling -13.96% with session volume was recorded 24.23 Million. Casablanca Capital LP released on Friday that it has agreed to close following the death of its founder, Donald Drapkin, and to sell its stake in Cliffs Natural Resources Inc. (CLF).
“In connection with that wind down, we have exited our position in Cliffs Natural Resources Inc., held by funds or accounts managed by Casablanca, entirely. Casablanca held 7.3 million shares, or 4 percent, of Cliffs, according to an April 27 filing.
The 2018 bonds have staged a massive rally...up nearly 5 times in value. This assumes of course that the morningstar bond price data is correct. Last sale on the bonds was $624.40. There has been no decline in the bond price in conjunction with the recent share price decline. Looks to me like the bond holders are not in the least bit concerned about the share price move.
Everyone knows that the founder and owner of Casablanca died months ago. CLF was Casablanca's only shareholding. It is no surprise that Casablanca would close down and liquidate its holdings (ie CLF). It is good that they finally got out as their shareholding in CLF was simply an unnecessary overhang on the stock. Casablanca lost a lot of money in its CLF investment as their cost was in the mid $20's I believe. As an investment partnership focused on activist investments, Casablanca's business is to make money through its investments and collect 20% of the profits it makes. Since the CLF position was a significant loss, there are no 20% of profits to be collected and with the founder and sole owner having died, I am sure that his estate must liquidate and distributes any assets that Casablanca holds. In a week or two, no one will even remember that Casablanca was involved in CLF. I haven't even heard the Casablanca name mentioned regarding CLF in months.
Earnings report and other fundamentals were fantastic. Essar Algoma shipment resumed with full slate of production in 2017. US Steel Canada a new customer. Pellet prices up. Costs down. More debt retired. No issue regarding liquidity. Bond prices up and rallying. If there were any kind of liquidity crisis, there is no way that the CEO would be talking about crushing the short sellers. And his whole tone on the conference call would be different. Best quarters of the year are coming just as steel dumping tariffs are taking effect.
I have to say that I am more than a bit mystified. The company posted a great earnings report. And shares rallied on the news. Then a day later the shares go down 10% a day three days in a row on no news? The steel stocks have not fallen at all and the other iron ore players aren't nearly down as much - maybe 10%. CLF is the only domestic iron ore stock so the traders probably just beat up on it when the opportunity strikes. I would also add that CLF got analys upgrades, one with a target of $6.