Japan’s Nippon Steel to acquire U.S. Steel for $14.9 billion

The deal was unanimously approved by the NSC Board of Directors and the U.S. Steel

Nippon Steel Corporation (NSC), the largest steel producer in Japan and one of the leading steel producers in the world, will acquire the American steel company United States Steel Corporation (U.S. Steel) at a price of $55 per share, which is approximately $14.9 billion, including debt. This is stated in the press release of U.S. Steel.

“The purchase price of $55 per share represents a 40% premium to the closing price of U.S. shares. Steel on December 15, 2023. The transaction was unanimously approved by the Board of Directors of NSC and the U.S. Steel,» the message says.

The acquisition of U.S. Steel will strengthen NSC’s world-leading manufacturing and technology capabilities and expand the company’s geographic footprint. The transaction significantly diversifies NSC’s global presence, as well as expands the company’s current facilities in the US and adds Japan, ASEAN and India to its core markets.

The deal will bring Nippon Steel’s expected annual steelmaking capacity to 86 million tons. This accelerates NSC’s strategic goal of reaching 100 million tons of global steelmaking capacity.

«We believe this transaction is deeply in the best interests of both companies, providing high and immediate value to U.S. Steel shareholders while enhancing NSC’s long-term prospects. We have strong cash flow and are confident in our ability to unlock the potential of the combination of NSC and U.S. Steel,» said Takahiro Mori, Executive Vice President of NSC.

The deal is expected to close in the second or third quarter of 2024.

As GMK Center reported earlier, in August 2023, the U.S. Steel rejected the offer from rival Cleveland-Cliffs about a takeover valued at $7.3 billion U.S. Steel called the proposal “preposterous.” Instead, the company announced a strategic options review process, saying it had received several offers for parts of the business or all of it.