US Steel shareholders approve Nippon Steel’s $14.9 billion offer

More than 98% of votes were cast in favor of the deal

US Steel shareholders late last week approved Japan’s Nippon Steel’s $14.9 billion offer to buy the American company, a step toward a merger despite growing political opposition to the deal, Reuters reports.

US Steel reported that more than 98% of votes were cast in favor of the deal, under which Nippon will pay $55 per share.

However, since the proposal was announced last December, several U.S. lawmakers have opposed the deal, citing national security concerns. US President Joe Biden said that US Steel should remain an American company owned by Americans.

The deal has also drawn sharp criticism from the United Steelworkers (USW), which is concerned about potential job losses, although Nippon has promised not to cut them and to honor all agreements between the union and U.S. Steel.

«We are not surprised that the shareholders have decided to cash in and sell out the workers and retirees of an iconic American company,» the USW commented on the shareholders’ decision.

In addition, the proposed acquisition is being scrutinized by regulators. The Committee on Foreign Investment in the United States (CFIUS) met with the parties to discuss the deal. According to Politico, the US Department of Justice has launched an in-depth antitrust investigation.

The Japanese company believes that the vote of US Steel shareholders is an important step.

«We look forward to working closely with US Steel to move forward together as a top steel producer with world-leading capabilities,» said Takahiro Mori, Vice Chairman of Nippon Steel.

Earlier, both parties reported that the deal is expected to close in the second or third quarter of this year. Bloomberg News reported late last week, citing sources familiar with the matter, that the two steelmakers expect to announce that this could happen in the second half of 2024.

The EUis considering the acquisition of US Steel by Japan’s Nippon Steel. An antitrust decision on the deal is expected by May 17. The process is classified as a simplified procedure, which is usually used when competition concerns are minimal or when the market share of the companies involved, individually or in aggregate, is small.

As GMK Center reported earlier, Sherrod Brown, chairman of the US Senate Banking Committee, called on the White House to scrutinize the relationship between Nippon Steel and the Chinese steel industry. At the same time, the United Steelworkers rejected a letter from the Japanese steelmaker with commitments on costs and job protection, calling it a «meaningless piece of paper.» The union said it received it on March 27 along with a draft agreement.