(Bloomberg) -- Cleveland-Cliffs Inc. Chief Executive Officer Lourenco Goncalves said he’d consider another bid — with union support — for United States Steel Corp., albeit at a significantly lower price than the existing offer from Nippon Steel Corp.

That potential bid, though, is dependent on the current Nippon-US Steel tie-up falling apart, Goncalves said in a phone interview. If he were to make an offer, the Cliffs CEO said he’d have the backing of the influential steelworkers union that’s also blasted Nippon’s takeover approach. 

The Cliffs CEO, known in the industry for his colorful and combative approach, touted his closeness and support from the steel union — and then proved his point by dialing USW President David McCall into the call with Bloomberg News. In the call, McCall reiterated the union’s support for a potential Cliffs bid.

Read More: US Steel Takeover’s Fate May Hang on the Words of a Union Boss

Goncalves also said he’s talking regularly to the White House.

The White House declined to comment.

A recent share plunge for US Steel shows that investors are increasingly concerned about the future of the Nippon deal. President Joe Biden on Thursday said the iconic Pennsylvania company should retain American ownership. Biden’s move against a takeover by a the Japanese company came despite the risk of upsetting a key ally. 

Biden’s comments have also shone a fresh light on the influential position held by the USW and its leader. Biden called McCall Thursday morning, reiterating that “he has the steelworkers’ back,” the White House said in a statement. For its part, the union said Thursday afternoon in a statement that it welcomed Biden’s call for US Steel to remain domestically owned and operated, saying that the president’s statement should “end the debate.”

US Steel plunged as much as 11% on Thursday to $36.38, but pared gains after Bloomberg reported Goncalves’ comments, closing at $38.26. The stock still dropped about 18% in two days, the biggest such loss since 2020, and is trading sharply below the Nippon offer of $55 per share. 

Read More: US Steel Plunges for Second Day as Biden Comes Out Against Deal

If given the opportunity, Goncalves would consider a bid “in the $30s,” he said in the interview Thursday. Cliffs shares also pared some earlier losses to close down 3.8%, after dropping as much as 5.9%.

Nippon Steel said in a statement on Thursday evening that “our transaction delivers clear benefits to US Steel, union workers, the broader American steel industry, and American national security.” 

“No other US steel company on its own can meet this challenge while also meeting antitrust requirements,” the company added in the statement.

Biden’s Intervention

Biden’s statement marks a rare presidential intervention in a transaction that outside an election year would have drawn less public scrutiny. Despite its storied history, US Steel’s role in the economy has diminished over several decades, a period during which producers in Asia have risen to dominate the global steel market. And while Nippon Steel’s proposed $14.1 billion acquisition targets a historic business name, a takeover in the US commodities industry by a company based in a friendly country is hardly unusual.

Still, the announcement of a Japanese company’s acquisition triggered opposition from Republican and Democratic lawmakers as well as the union. Biden’s allies have urged the administration to kill the deal over what they say are national security concerns and a threat to unionized steel jobs. Nippon Steel has said it will honor all agreements US Steel has with the USW.

Goncalves said he thinks it’s a “foregone conclusion” the Nippon deal will fall apart. 

“There is no more lobbying, there’s no more negotiation. It’s over. It’s over,” Goncalves said, referring to Nippon Steel’s deal to buy US Steel. “And the only other buyer that the union would accept is Cleveland-Cliffs.”

Union Support

After dialing McCall into the phone interview, Goncalves said to the union leader: “I would like you to, if you can, express to him — to confirm or negate — if you disagree with me, that Cliffs is the only company the union would endorse to acquire.”

“Yes, because you still have our right to bid,” McCall responded to Goncalves. He was referring to a legal right the union had to launch a counteroffer for US Steel, which it transferred to Cliffs last year. 

The Nippon bid remains on the table and it’s not clear what implications Biden’s remarks might actually have for an ongoing federal review. 

Still, the reiteration of support from the union for Cliffs will be a blow to the Japanese company, which has been seeking to win over McCall and his labor group in order to reduce the political pressure against the deal.

Read More: No Labor Agreement, No Deal: Steel Union Draws Line for Nippon

US Steel was catapulted into the spotlight in August after revealing it had rejected an offer from Cliffs and begun a strategic review. The announcement kicked off a dramatic few weeks, as the USW threw its support behind Cliffs’ pugnacious CEO, while a little-known buyer startled the industry with an even larger offer, before abruptly pulling its interest days later.

Nippon’s agreement to buy US Steel in December ended months of uncertainty over the future of US Steel, which had been considering bids since it rejected an offer from rival Cleveland-Cliffs in August. Nippon Steel’s all-cash bid is significantly higher than the roughly $7.25 billion Cliffs offered at the time. 

Read More: Steel CEO Who Fights With Goldman Takes on US Industry Icon 

The union had a transferable right — which it had said it would pass on to Cliffs — to counterbid after an offer for US Steel as part of its collective bargaining agreement. And former USW President Tom Conway, who died in September, told Bloomberg News in August that the union wouldn’t support any foreign bidder. 

Still, after the Nippon deal was announced in December, Cliffs in a statement congratulated US Steel on the deal and wished it well with the transaction. And Goncalves at the time said Cliffs would refocus its capital allocation priorities toward more aggressive share buybacks. 

Read More: Cliffs CEO Lashes Out Over Losing US Steel Deal to Nippon

Much of Goncalves’s newfound confidence now comes in light of both the union support and Biden’s strongly-worded statement. Goncalves said he’s been in regular contact with the Biden administration. 

“I’m not surprised. We have been in total contact with the administration, so I know what’s going on,” Goncalves said. “The contact is about making it abundantly clear between me and Dave McCall that the only buyer the union accepts for the union-represented assets is Cleveland-Cliffs.”

Nippon Steel has told investors it expects the deal to close by the second or third quarter of this year, while Bloomberg News previously reported that people familiar with the matter say a US national security review is unlikely to conclude until late this year or into 2025. 

“It’s just naive to believe this process will be dragging through the election,” Goncalves said. “This deal is dead. What the administration is trying to do is give Japan the opportunity to retreat.”

--With assistance from Josh Wingrove and Yiqin Shen.

(Updates with Nippon Steel statement, starting in 10th paragraph.)

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