Updated at 7:55 am EST
American steel (x) – Get a free report Shares soared on Monday after Japan's Nippon Steel agreed to acquire the steel group for about $15 billion.
Nippon said it would pay $55 per share, about $14.1 billion, for US Steel, a nearly 40% premium to the Pittsburgh group's Friday closing price. Including debt, the overall deal values US Steel at about $14.9 billion.
The purchase would give Nippon Steel, the world's fourth-largest steel company, an important foothold in the world's largest economy.
US Steel, which began a strategic review of its operations in early August, rejected offers from US rival Cleveland-Cliffs. (CLF) – Get a free report and privately held Esmark, which values it at about $7.85 billion. ArcelorMittal of France (MOUNTAIN) – Get a free report Apparently he was also interested in US Steel.
Nippon Steel said it would honor all current agreements on wages and working conditions reached with the United Steelworkers Union.
“NSC has a proven track record of acquiring, operating and investing in steel facilities globally, and we are confident that, like our strategy, this combination is truly the best for everyone,” the US CEO said in a statement. Steel, David Burritt.
“This transaction reflects the tremendous current value of our company and is the result of our board of directors' comprehensive and exhaustive strategic alternatives process.”
US Steel shares are up 28.65% in pre-market trading, indicating an opening price of $50.60 each.
US Steel-Nippon Steel pact may face challenges
The sale could still face legal and political challenges, however, after Sen. JD Vance (R-Ohio) earlier this year pressured the group to sell to an American buyer.
In an open letter to the group in August, Vance urged Burritt to consider “the effects of any decision on the industrial base and national security of the United States and insist that any offer to acquire US Steel or its assets from an entity be rejected.” foreigner.”
The Committee on Foreign Investment in the United States, better known as CFIUS, is also expected to review the deal, particularly given that the company will benefit from taxpayer funds tied to the Inflation Reduction Act.
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