BY Fraser Tennant
In a deal that creates the world’s second-biggest steel producer, Japan’s largest steelmaker Nippon Steel Corporation (NSC) is to acquire United States Steel Corporation for approximately $14.1bn.
Under the terms of the definitive agreement, NSC will acquire US Steel for $55 per share in an all-cash transaction representing 40 percent premium, providing certain and immediate value to US Steel shareholders.
The transaction will further diversify NSC’s global footprint by significantly expanding its current production in the US, adding to its primary geographies of Japan, Association of Southeast Asian Nations (ASEAN) and India.
As a result of the acquisition, it is expected that NSC’s total annual crude steel capacity will reach 86 million tonnes – accelerating progress toward its strategic goal of 100 million tonnes of global crude steel capacity annually.
“This transaction brings together two companies with world-leading technologies and manufacturing capabilities,” said Eiji Hashimoto, president of NSC. “It also demonstrates our mission to serve customers worldwide, as well as our commitment to building a more environmentally friendly society through the decarbonisation of steel.”
The transaction has been unanimously approved by the board of directors of both NSC and US Steel.
“NSC has a proven track record of acquiring, operating and investing in steel mill facilities globally,” said David B. Burritt, president and chief executive of US Steel. “The transaction also benefits the US – ensuring a competitive, domestic steel industry, while strengthening our presence globally.”
The transaction is expected to close in the second or third quarter of 2024, subject to approval by US Steel’s shareholders, receipt of customary regulatory approvals and other customary closing conditions.
Mr Hashimoto concluded: “NSC has long admired US Steel with deep respect for its advanced technologies, rich history and talented workforce and we believe we can jointly take on the challenge of raising our aspirations to even greater heights.”
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