dan..BL mine cost is too high. You are close to it..What CLF needs is to bundle it with Australia/Asia assets and spin off as an IPO Priced @ $15-$17, then \proceed to pay off ALL debt and clean slate and decide what they want to do. as a domestic company and may want to roll it into a MLP so no taxes will have to be paid ..IMO.
If CLF continues to go down like this each tyrading day, The company will extinct operating in less than 2 months....lol
And just concentrate and expand more here domestically. Whatever they can get out of China is ok as an additional profit but the stock should not go crazy with every China movement, action or problem. They need to insulate themselves and unlike BHP,RIO or Vale, they are #$%$ company. .This is what CAS wants to do
Book Vaue will be up quiet abit to atleast $25-$30 if they spin off INT assets and surf is right stock generally trades at twice the book value.
CLF paid $4.9 B for BL mine and then spent atleast another $3 B upgrading this and other Asian assets. Their current debt is $3.3 B. If they can get just the amount equal to their debt from spinning off Asia/Pac and BL assets. they will be debt fee. Thats what CAS wants to do. CLF has no money right now to buy their shares or increase dividend. But if they spin off those assets, they CAN. Then they dont have to compete with BHP,RIO , Seaborne IO and CHINA's economy.
Second the cost of IO from BL is around $80 and if added another $235 for amortization, depletion and depreciation, the mine is NOT Prifitable unless IO price exceed $120 atleast.
So its worth spinning off. They can wait om Ring of Fire Chromite stuff until the roads are built But why Carrabba Bought this aset w/o any access to the mine is mind boging. Surf is right that when the transportation system is in place, this Chromite asset would worth alot more and there is no problem waiting for it now.
Finally Kirsch andf Management are afraid that CAS will easily take control of the Board with the help of other big holders of CLF stock because of the way CLF bylaws are,and do what they want with INT assets and keep domenstic operations and even expand it. In the meantime, CLF should cut manpower, cut their salalries , skip bonuses and work with CAS. How Kirsch and others have destroyed this company with a loss of nearly 85% in equity and them holding 1% or less stake is beyond my imagination. And they dont want to give up the control.
Surf.. they feel that they rather fight CAS than to put out material INFO AND REASSURE SHAREHOLDERS. Also they should buy back some shares in open market at this low price, and give some idea about Q-1 earnings which analysts think will be terrible.
CF should cut the work force by 20%, management take 20% cuts in pay and No bonuses,, sell Chromite mine because no roads to get there by any means, sell Pac/asia and BL mine to Vale etc. and use money to pay down as much as possible and concentrate on domestic operations.
Very scary Q-1 E. estimates... Low ( minus) - $0.17, Mean $0.08, High $0.41
This management MUST MUST GO now before they do any more damage. Mkt Cap only $2.7 B now
skit..how do shareholders vote since Kirsch has postponed the annual meeting indefinitely? Kirsch knows if voting proceed they will all be out.
Damn... now down more than 5% and IO entering in bear market. Forget China and concentrate in domestic markets only where they are doing very well. Any guesses how low this POS will go? Every day this stock just keeps going down down and more down w/o BOTTOM.
So whats new? its down 2.5% . Kirsch, the Chairman of the Board and Management have less than 1% of shares and don't give a damn that this stock is now down some 85% and may be the worst S & P 500 stock 3rd year in a row . CAS will get 6 seats because the way the CLF"s Bylaws are and then kick out the whole Board and the management because of the majority they will get on the Board. I bet over 90% will vote with CAS.
CAS will install their CEO and then split the company by spinning off Asia/PAC + BL mine and enhance CLF's market value in$30's at least . Hope this happens sooner than later. Good luck all LONGS!!
CLF has NOT changed their corporate structure. When CLF management asked to vote on it, it failed twice. This is a big plus for CAS. What this means is that if you hold 500 shares of Cliff, you can spread 500 each to each of 10 Directors or can vote 5000 for just one Director. Thus CAS management doesn't have the muscles and since they have #$%$ off their shareholders, most will likely vote all for CAS nominated directors and they should get 6 seats on the Board easily.. Additionally CAS Management only owns 1% of outstanding shares and 41.27% shares are owned by Institutions like CAS, and 17.2% are owned by Mutual Funds. Most Institutions and Mutual funds likely will vote with CAS if it immediately BOOST CLF's stock price..IMO.
Wabush IO mining cost is $143/tonne and was idled in June of 2013 because of its high cost and ..Bloom Lake mining cost will be $80-90/tonne plus additional $25/tonne depreciation, depletion and amortization cost and it is still in Stage I development and the stage II expansion of BL suspended indefinitely.
US operations ave. cost is $65-$70/tonne
Aussie mines operation cost is expected to be $60-$65/tonne in 2014
Met Coals at current sales Vol is $87/tonne
CAS wants BL mine and Asia-Pacific assets spinned off since they are in direct competition with Seaborne
Iron Ore .
When the management is stupid and arrogant. For last 3 years they kept blaming on economy and lower IO price, but the truth is that they could had taken a number of steps to correct the situation including selling some assets but Carabba and Kirsch sat on their butts in their ivory tower corner offices and watched it lose 80% or more equity. Now they have an activist who wants to stir up the things and improve company's performance, they come up wih all kinda excuses including postponing the annual meeting. This thing is not gonna fly and NOT going away as shareholders are not going to put up with this S*** any longer. Bye Bbyeyooooooooo.. Kirsch and Halverson ( Halv is going to be a poor victim here).. your days are numbered. Some thing will happen over the weekend..IMO
That's what I thought too..mike.When there is an outsider coming to restructure the company, generally stock price gets bumped up. and NOT DOWN.