Cleveland-Cliffs urges shareholders to reject Harbinger's bid for control on Oct. 3

By Lisa Kerner

Charlotte, N.C., Sept. 8 - Cleveland-Cliffs Inc. asked its shareholders to vote against Harbinger Capital Partners' control share acquisition proposal at the special meeting on Oct. 3.

Harbinger is seeking at least one-fifth but less than one-third of the company's voting power by acquiring additional shares of Cleveland-Cliffs, it was previously reported.

Currently, Harbinger Capital Partners Master Fund I, Ltd. directly and indirectly owns 9 million shares, or 8.43%, of Cleveland-Cliffs. Harbinger Capital Partners Special Situations Fund, LP directly and indirectly owns 7,616,472 shares, or 7.14%, of the company's total issued and outstanding shares.

In a Sept. 8 letter to shareholders, Cleveland-Cliffs explained that an acquisition of one-third of the company's common stock effectively provides the acquiring person with control over strategic decisions.

Harbinger is opposed to Cleveland-Cliffs' July 15 agreement to acquire Alpha Natural Resources, Inc. in a $10 billion cash and stock transaction.

Cleveland-Cliffs, a 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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