TORONTO (miningweekly.com) – Activist shareholder Casablanca Capital late on Friday nominated a slate of six persons for election to the Cliffs Natural Resources board at the 2014 annual meeting scheduled for May 13.

Casablanca, which owns and manages about 5.2% of Cliffs, in January launched a proxy fight, seeking to install its own CEO and directors, and suggesting the spin-out of certain of Cliffs’ international operations.

The fund manager highlighted what it termed “Cliffs’ failed expansion strategy” and the resultant loss of more than 80% of the company’s market value, which it alleged was being overseen by a majority of the current 11-member board.

Casablanca also outlined its proposal for a new strategy focused on Cliffs’ core US assets, which it believed would restore value for shareholders, and reiterated its support for 30-year metals and mining veteran Lourenco Goncalves as its chosen leader to assume the position of CEO of Cliffs.

“Casablanca is committed to fixing Cliffs and restoring its value on behalf of all shareholders. We are putting forward a highly qualified slate of independent directors, including Goncalves, who are far better equipped than the incumbent board members to implement a new strategic direction for Cliffs and to take the steps we believe are urgently required for the company to get back on track and realise its full potential value,” Casablanca chairperson Donald Drapkin said.

Casablanca’s nominees included Goncalves, Rip Fisher, Patrice Merrin, Joseph Rutkowski, Gabriel Stoliar and Douglas Taylor.

In an open letter to Cliffs, the fund manager in January advocated that Cliffs spin off its Bloom Lake iron-ore mine, in Quebec, together with Asia Pacific, to create ‘Cliffs International’.

Cliffs operates two distinct iron-ore businesses with very different risk/reward profiles. The Cliffs International assets are directly exposed to the competitive ‘seaborne’ iron-ore market, and the large Bloom Lake project is still in the development stage.

In contrast, the ‘Cliffs USA’ iron-ore assets benefit from unique supply and demand characteristics and barriers to entry in the Great Lakes, generate strong cash flow and enjoy long-term contracts, which provide volume and price visibility.

The activist shareholder also urged the board to double the dividend paid by Cliffs USA going forward; convert the US assets to a master limited partnership; significantly cut selling, general and administrative expenses and exploration expenses; optimise cash costs and operating profitability; divest infrastructure and other noncore assets; set clear objectives for return on capital; and hire strategic and financial advisers to assist in evaluating and executing these measures.

It said Cliffs had significantly underperformed both its peer group and the broader market in recent years. For most of 2013, the company held the title of "biggest loser" in the S&P 500, finishing the year in the number two spot, and remained one of the most shorted equities in the index.

On Monday morning, Cliffs traded $0.85 lower at $17.80 apiece.