By: Henry Lazenby, 20th June 2014

Creamer Media's Mining Weekly

TORONTO (miningweekly.com) – US-based iron-ore and coal producer Cliffs Natural Resources on Thursday 'approved' a slate of six board nominees put forward by activist shareholder Casablanca Capital, for the limited purpose of not triggering a so-called proxy put.

Cleveland-headquartered Cliffs said in a statement that its board had been considering whether Casablanca's nominees should be approved under the provisions of a senior notes indenture containing a 'change of control clause', potentially compelling it to repurchase the notes.

This mandatory repurchase, or proxy put, would result in a cash-flow crisis for Cliffs.

“The Cliffs board today took this limited, technical action after determining that this action was prudent to protect the interests of all of Cliffs' shareholders by eliminating the possibility that the outcome of the upcoming board election could result in triggering the change of control provision.

“In no way should today's action be construed as Cliffs endorsing any of the Casablanca nominees in the proxy contest,” the company said.

Casablanca, which owns and manages about 5.2% of Cliffs, last month threatened to take the miner to court over the proxy put, which it viewed as a tactic by Cliffs’ board to threaten shareholders not to vote for the activist shareholder’s slate of nominees.

Last week Cliffs announced a slate of nine nominees, in effect conceding two positions in the contested 11-seat board to Casablanca.

By: Henry Lazenby, 20th June 2014