Shareholders of both Cleveland-Cliffs and AK Steel on Tuesday voted to approve the merger between the two companies, the last major step before the deal closes Friday.
Under the merger, AK Steel, a producer of flat-rolled carbon and stainless and electrical steel products, would become a subsidiary of Cliffs, which owns several Minnesota and Michigan iron ore mines and taconite plants.
The move allows Cliffs to own AK Steel’s existing blast furnaces and electric arc furnaces, and supply the furnaces with its own iron ore pellets. Cliffs had long sold its pellets to other steelmakers.
"The new Cleveland-Cliffs is a lot stronger than either Cliffs or AK Steel individually. We are ready to transform your confidence into shareholder value, and that’s what we are going to do,” Cliffs CEO Lourenco Goncalves said in a statement after the votes Tuesday.
But last week, Goncalves warned that if a loophole in President Donald Trump's sweeping steel tariffs wasn't closed, he'd be forced to shutter the United States' last producers of grain-oriented electrical steels in Butler, Pennsylvania and Zanesville, Ohio. Those two AK Steel plants employ 1,500 and 100 people, respectively.
"I promise (the jobs) will be gone if I don't get help," Goncalves told the Congressional Steel Caucus last week.
Goncalves said countries the U.S. imposed steel tariffs on — like China, South Korea and Japan — are shipping mostly-finished electrical steels into Mexico for one final step in production, then trucking it into the U.S. to avoid tariffs, a move that he said is making the plants unprofitable.
"I'm not in this business to lose money," Goncalves said.