Cliffs Natural Resources is facing a shareholder insurrection as it makes moves to reel in spending.
The Ring of Fire explorer and Ohio-based iron ore miner is cutting its capital expenditures in half with a proposed 2014 budget of between US $375 million and US $425 compared to the US $862 million spent in 2013.
An expansion at its Bloom Lake iron ore mine in Quebec is being stopped, its Wabush iron mine in Labrador is being shuttered, and late last fall, Cliffs halted all exploration activity and technical work at its Black Thor chromite project in the Ring of Fire, placing it on indefinite suspension.
The Ohio miner is also fighting a backwater action against New York-based investment firm, Casablanca Capital, which wants Cliffs to spin off its international assets from its American operations.
Casablanca, which holds a 5.2 per cent stake in Cliffs, plans to nominate a new slate of members for the board of directors at Cliffs upcoming annual shareholders meeting.
Casablanca intends to nominate Lourenco Goncalves, former CEO of Metals USA, as Cliffs' new CEO and a new board of directors.
Cliffs is backing the leadership of its new president and chief operating officer (COO) Gary Halverson who came aboard last November from Barrick Gold’s US operation where he was interim COO. Halverson is being eased into the CEO’s role.
“The choice of Mr. Halverson as incoming CEO follows an exhaustive search by the Board, together with a leading executive search firm, which began in July of 2013. Following a comprehensive search, the Board determined that Mr. Halverson was the right leader given his deep international and large scale mining industry leadership experience.”
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