HOYT LAKES (AP) -- LTV Corp. on Wednesday announced an agreement to sell the assets of its LTV Steel Mining Co. to subsidiaries of Cleveland Cliffs Inc. and Minnesota Power for $25 million.
Under the deal, the purchasers each will pay $12.5 million to LTV and will assume environmental and other liabilities.
Cleveland Cliffs will purchase the assets of the iron mine, processing plant, 74-mile rail line and loading dock. Minnesota Power will purchase LTV Steel Mining's 225 megawatt electric power generating plant, transmission facilities and related assets. Minnesota Power also will make a $62.5 million payment to Cliffs, which will use the money for its share of the purchase price and the environmental liabilities and holding costs being assumed by the company.
The agreement requires approval by U.S. Bankruptcy Court in Youngstown, Ohio, where LTV Steel Corp.'s Chapter 11 proceedings are being decided.
Cliffs on Friday also entered into an option agreement with the Iron Range Resources and Rehabilitation Board that will enable the IRRRB to purchase several thousand acres of mining lands for future development.
"We are pleased that we were able to work with the State of Minnesota and Minnesota Power to reach this agreement," said John Brinzo, Cliffs' chairman and chief executive. "We believe this is the best way to promote future economic activity on the East Mesabi Range."
Brinzo said Cliffs will not use the plant to produce taconite pellets, but is looking at options, including development of other metals and providing transportation support services for other Minnesota mining operations.
A deal to transfer ownership of the plant and its assets has been in the works since LTV Steel Corp. closed the 43-year-old taconite plant in January, leaving 1,400 workers without jobs.
"I believe it's the best thing for Northeastern Minnesota," said IRRRB Commissioner John Swift.
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