UPDATE 1-Miner Cliffs says to cut 2014 capital spending by 25 pct
(Adds details on cuts, context)
May 27 (Reuters) - Cliffs Natural Resources Inc, which is fighting an activist investor who wants to split up the company and replace its chief executive, said on Tuesday it will cut 2014 capital spending by $100 million, or 25 percent, as it deals with weak seaborne iron ore and metallurgical coal prices.
The U.S.-based iron ore and coal producer said capital expenditures this year will now be between $275 million and $325 million as it focuses on financial discipline at a time of volatile prices.
Cliffs said it expects seaborne iron ore and metallurgical coal prices to remain weak in the near term, which will reduce revenue in most of the company's business segments.
"The long-term supply contracts in U.S. iron ore, Cliffs' largest and most profitable business segment, will significantly mitigate the impact of lower seaborne iron ore prices on consolidated revenues," the company said in a statement.
About 75 percent of the spending cut will be in Cliffs' Eastern Canadian iron ore and North American coal operations.
Even before Tuesday's announcement, Cliffs had said its capital spending in 2014 would be 55 percent lower than it was in 2013.
New York hedge fund Casablanca Capital wants Cliffs to spin off its assets outside the United States, arguing that they weigh on the company's profitable Great Lakes business.
Casablanca also wants Lourenco Goncalves, the former chief executive of Metals USA, to replace Gary Halverson as Cliffs CEO. Halverson, a former Barrick executive, was appointed CEO in February. (Reporting by Nicole Mordant in Vancouver, editing by Meredith Mazzilli and Peter Galloway)
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