One of America’s oldest and best-known companies, United States Steel Corporation, on Monday agreed to sell it to Japan’s largest steel company, Nippon Steel Corporation, or NSC.
Company U.S. Steel has been auctioned since August, and Nippon’s all-cash deal is the highest price at $14.1 billion. Included is the supposition of all of U.S. Steel’s debt in a total deal valued at $14.9 billion.
“NSC has a proven track record of acquiring, operating, and investing in steel mills around the world, and we believe that, like our strategy, this combination is truly the best for everyone,” David Burritt, Chairman and CEO of American Steel. it is stated in the press release.
NSC President Eiji Hashimoto said in a statement, “We look forward to working closely with Team U.S. Steel to bring together the best of our companies and move forward together as ‘The best steel producer with world-leading capabilities.'”
The announcement of the deal sent US Steel shares soaring in financial markets, with the value of shareholders’ shares increasing by more than 25%. In addition, as part of the deal, Nippon will uphold all U.S. union contracts and agreements. Steel, will retain its name and maintain its headquarters in Pittsburgh, Pennsylvania.
Despite these assurances, opposition to the deal from the United Steelworkers, or USW, union was swift, highly critical, and strong. In the U.S. Steel has 11,000 union members and its leadership has made clear its plans to block the deal and urged US regulators to reject it.
” To say that we are disappointed with the announced agreement between the U.S. Steel and Nippon is an understatement because it shows the same rapacity, and shortsightedness that the United States statement.
Nippon’s offer to acquire U.S. Steel is far from finished. In addition to overcoming opposition from the 1.2 million members of the United Steelworkers union worldwide, the deal is expected to be reviewed by the Committee on Foreign Investment in the United States, or CFIUS. CFIUS analyzes foreign investment transactions in the United States and their potential impact on national security.
The committee may need 45 days to review the deal and another 45 days to investigate it. Then there is a 15-day presidential review period. That means it could take months before the Nippon U.S. Steel acquisition is approved or rejected.
VOA asked the committee when it might begin evaluating the deal, but the committee declined to comment.
However, Nippon and U.S. Steel expressed optimism that the deal will close by the third quarter of 2024.
The 122-year-old U.S. Steel was once the largest and most valuable company in the world, and the first to be valued at more than a billion dollars. However, after years of decline, some critics say it is currently struggling, largely due to the company’s failure to modernize its steelmaking processes and plants.
