After much speculation, United States Steel Corp. (NYSE:X) has agreed to be acquired by Nippon Steel Corp. (OTC:NISTF) at $55 per share. NISTF is the largest steelmaker in Japan.
The purchase tag implies a $14.9 billion enterprise value for US Steel. This mega M&A move is expected to boost NISTF’s manufacturing and technological capabilities. Additionally, the deal will enable Nippon to expand its presence in areas where X has a strong footing and can better cater to customers.
Further, the transaction is anticipated to boost NISTF’s total annual crude steel capacity to 86 million tonnes. The Japanese giant aims to reach a total global capacity of 100 million tonnes per year. Importantly, NISTF plans to honor all of US Steel’s present union contracts.
Who Is Buying US Steel?
X’s acquisition deal with Nippon is subject to closing conditions and regulatory approvals. It is anticipated to close in the second or third quarter of calendar year 2024. Today’s announcement comes after multiple suitors lined up for US Steel, with names such as The Cleveland Cliffs (NYSE:CLF) and Arcellor Mittal (NYSE:MT) in the running for the steel producer.
Today’s announcement has sent X shares nearly 28% higher at the time of writing. Last week, the stock had closed at a five-year high of $39.33.
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