Japan’s Nippon Steel to buy US Steel in $14.9B deal

Date:

Japan’s Nippon Steel said on Monday it would buy U.S. Steel in a deal valued at $14.9 billion including debt, months after the steelmaker put itself up for sale.

The per-share offer of $55 represents a premium of about 40% to U.S. Steel’s Friday’s close and 142% compared to the stock’s closing price before the company announced a strategic review process on Aug. 11.

U.S. Steel’s shares rose about 27% in premarket trading.

US STEEL ANNOUNCES PLANS TO LAY OFF HUNDREDS AT SOUTHERN ILLINOIS MILL

Nippon, the world’s No. 4 steelmaker, sees the U.S. as a growth market that can help to offset declining demand in Japan, the Nikkei daily, which earlier reported the deal, said.

Nippon has secured financing commitments for the deal and expects it will enable the company to move toward 100 million tonnes of global crude steel capacity.

All of U. S. Steel’s commitments with its employees, including all collective bargaining agreements in place with its unions, will be honored, Nippon said.

In the middle of August, U.S. Steel launched a formal review process, after rebuffing a $7.3 billion offer from rival Cleveland-Cliffs Inc.

While Cliffs continued to participate in the sale process, steelmaking giant ArcelorMittal SA was also considering an offer, Reuters reported in August.

Pittsburgh-based U.S. Steel’s shares had suffered after several quarters of falling revenue and profit, making it an attractive takeover target for rivals looking to add a maker of steel used by the automobile industry.

U.S. Steel also supplies to the renewable energy industry and stands to benefit from the Inflation Reduction Act (IRA), which provides tax credits and other incentives for such projects, something that attracted suitors.

Companies including U.S. Steel are also set for a strong start to 2024 as steel prices spike following a resolution of the United Auto Workers (UAW) union strike against the Detroit Three automakers.

Worker with a sign

Citi is the financial adviser to NSC while Barclays Capital, Goldman Sachs and Evercore are the financial advisers to U. S. Steel.

Read the full article here

spot_img

Share post:

Subscribe to our newsletter

To be updated with all the latest news, offers and special announcements.

Popular

More like this
Related

Harrington & Richardson Releases New Braced Retro Pistols

Posted 6 hours ago in AR Patterned, AR-15, Daily...

Hard Head Veterans Introduces the ATE GEN3 Ballistic Helmet

Posted 3 hours ago in Armor, Daily News, Helmets...

Galco Hawkeye IWB Holster for S&W M&P Shield/Shield Plus w/ Red Dot

Posted 20 mins ago in Concealment, Daily News, Holster,...

Russia: U.S. Dollar Is Becoming “Toxic”

The United States government announced a new batch of...