Sources report that Cleveland-Cliffs is collaborating with Nucor on a possible bid for U.S. Steel.

• Sources informed CNBC's David Faber that Cleveland-Cliffs would acquire all of U.S. Steel for cash and subsequently sell off the Big River Steel subsidiary to Nucor.
• U.S. Steel's headquarters would remain in Pittsburgh under the deal.
• The offer would be in the high $30s a share.

Sources tell CNBC's David Faber that is partnering with rival in a potential bid for , whose takeover by Japan's Nippon Steel was just blocked by the White House earlier this month.

Under the deal, Cleveland-Cliffs would acquire all of U.S. Steel for cash and then sell off its Big River Steel subsidiary to Nucor. U.S. Steel's headquarters would remain in Pittsburgh.

Nippon had planned to purchase U.S. Steel for $55 per share in a deal worth more than $14 billion.

U.S. Steel shares jumped more than 7% in midmorning trading on Monday.

The deadline for Nippon to permanently end its pursuit of has been extended by the White House until June, as the companies continue to pursue a lawsuit in federal court against the decision to block the deal.

David Burritt, CEO of U.S. Steel, has urged President-elect Donald Trump to reverse Biden's decision to block the sale of U.S. Steel to Nippon Steel when he assumes office in January. Trump has also expressed opposition to Nippon's acquisition of U.S. Steel.

This is a developing story. Please check back for updates.