Harbinger Capital opposed to merger of Cleveland-Cliffs, Alpha Natural Resources

By Lisa Kerner

Charlotte, N.C., July 17 - Cleveland-Cliffs Inc. investor Harbinger Capital Partners Master Fund I, Ltd. is not in favor of the company's agreement to acquire Alpha Natural Resources, Inc., it was reported in a schedule 13D filed with the Securities and Exchange Commission.

Harbinger said it may take positions with respect to potential changes in the operations, management, board composition, ownership, capital structure, strategy and future plans of the company to enhance shareholder value.

Harbinger owns 16,616,472 Cleveland Cliffs shares or 18.36% of the company.

Cleveland-Cliffs agreed to acquire Alpha Natural Resources in a cash and stock transaction valued at approximately $10 billion.

It was previously reported that Alpha Natural Resources stockholders will receive 0.95 shares of Cleveland-Cliffs common stock and $22.23 in cash for a total value of $128.12 per Alpha Natural Resources share, based on the closing price of Cleveland-Cliffs' stock on July 15.

Total consideration comprises $1.7 billion in cash and approximately 71 million new shares of Cleveland-Cliffs common stock, a joint company news release said.

Cleveland-Cliffs, an international mining company, produces iron ore pellets in North America and supplies metallurgical coal to the steelmaking industry. The company is based in Cleveland.

Alpha Natural Resources, located in Abingdon, Va., supplies Appalachian coal to the steel industry, electric utilities and other industries.

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