U.S. Steel  (X) – Get Free Report shares soared higher in pre-market trading after the industrial giant rejected a $7.3 billion takeover offer from rival Cleveland-Cliffs CLE, calling the unsolicited deal an “unreasonable proposal”.

U.S. Steel said Cleveland-Cliffs, which went public with its takeover bid on Sunday, would not agree to sign a non-disclosure agreement that would allow the two companies to evaluate the cash-and-shares proposal. 

Cleveland-Cliffs said it was prepared to pay $32.53 a share for Pittsburgh-based U.S. Steel, based on $17.50 per share in cash and 1.023 shares of Cleveland-Cliffs stock. That would be a 43% premium to U.S. Steel’s Friday closing price and a level that would value the country’s second-biggest steelmaker at around $7.26 billion.

The group did, however, invite Cleveland-Cliffs to “reach out to our financial and legal representatives” and join the group’s recently-unveiled strategic review.

“As you well know, our Board – or any board – could not, consistent with its fiduciary duties, agree to a proposal of which 50% is represented by your stock without conducting a thorough and completely customary due diligence process, to evaluate the risks and potential upsides and downsides inherent in the transaction, including the stock component,” U.S. Steel said in a statement. “Doing otherwise would be tantamount to accepting a price without knowing what it in fact represents.” 

U.S. Steel shares were marked 28% higher in pre-market trading, indicating a Monday opening bell price of $29.05 each. Cleveland-Cliffs, meanwhile, fell 7% to $13.67 each. 

U.S. Steel shares closed at $22.72 each on the New York Stock Exchange Friday, after rising 0.98% on the session to peg their year-to-date decline at around 9.3% with a market value of $5.1 billion.

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