TORONTO May 29 An activist investor campaigning
against miner Cliffs Natural Resources Inc said Thursday
it may take the company to court over a "proxy put" that could
trigger a liquidity crisis if the hedge fund wins control of
Cliffs warned shareholders in a regulatory filing Friday
that if all six of New York hedge fund Casablanca Capital's
nominees were elected, the company may be forced to repurchase
its outstanding senior notes because of a change of control
provision on the notes.
Casablanca said Cliffs could defuse the problem by approving
its nominees "not as an endorsement, but merely for the narrow
purpose of not triggering the proxy put."
"Instead of implementing this now-common corporate
governance measure, the board has implied a willingness to put
the company's very existence at risk, employing brinksmanship
with the company's liquidity in an attempt to preserve its
current seats," Casablanca said in a statement.
Cliffs didn't immediately comment on the release.
(Reporting by Allison Martell; Editing by Bernadette Baum)