Ancora nominates slate of director candidates, proposes new CEO for U.S. Steel

Ancora Holdings issued the below open letter to the board of directors of United States Steel (X) regarding a variety of issues, including the company’s recently blocked sale to Nippon Steel (NPSCY). The letter read, in part, “Ancora is a growing shareholder of U.S. Steel. As an investment firm with deep roots in the Midwest, we have an affinity for the industrial and logistics companies that collectively form the backbone of America’s economy. We are proud to be investors in companies such as Berry Global Group, Inc., Norfolk Southern Corporation, RB Global, Inc. and now U.S. Steel. Owning these types of businesses enables us to pursue strong risk-adjusted returns while helping support American competitiveness, job creation and wage growth. Although we understand why the Board explored strategic alternatives in 2023, its ultimate decision to ignore national security and pursue a risky sale to Nippon – an overseas bidder that came in just $1 per share higher than a competing domestic bidder – has led to a dead end. There appears to be no legal basis and no precedent for U.S. Steel’s costly litigation over the Presidential Executive Order blocking the transaction. Moreover, President Donald Trump is a vocal opponent of the deal and long-term proponent of strengthening America’s domestic manufacturing base. He also has long-held skepticism about foreign direct investment from Japan based on his own business dealings dating back to the 1980s. We see no reason to believe that President Trump, a high-conviction businessman who was elected by middle-class and working-class voters, is going to contradict his self-described “America First” agenda and disregard the opposition of the United Steelworkers. The Board’s choice to double down on its extremely poor decision to pursue a sale to Nippon has also kept U.S. Steel in a corroded state. Chief Executive Officer David Burritt, who stood to rake in more than $70 million himself if the sale had been consummated, has been allowed to misallocate capital, issue unreliable and overoptimistic forecasts, and repeatedly miss financial targets. It seems the Board failed to keep Mr. Burritt’s attention on efficiency, execution and risk management as steel prices remained depressed over the past year. Rather than finally acknowledge the Company’s perilous trajectory and try to course correct, the Board remains steadfastly committed to an underperforming leader who apparently lacks the ability and vision to bring U.S. Steel back from a busted transaction. In light of these alarming decisions and the unjustifiable deference to Mr. Burritt, who has made clear through outlandish rhetoric that he is self-interested and unfit for leadership, Ancora has nominated nine highly qualified, independent candidates for election to the Board at U.S. Steel’s 2025 Annual Meeting of Stockholders. Our slate includes individuals with corporate governance experience, finance expertise, industrials and manufacturing backgrounds, public policy acumen and other qualifications critical to turning around a standalone U.S. Steel. The slate’s plan includes installing Alan Kestenbaum, a steel industry legend who delivered total shareholder returns of more than 450% at Stelco Holdings Inc., as a replacement for Mr. Burritt. We expect the investment community will agree that any steel company would be fortunate to have Mr. Kestenbaum assume such a role. Our slate and Mr. Kestenbaum look forward to ultimately releasing their full plan for enhancing U.S. Steel’s corporate governance, cost structure, labor relations, margins, operations and long-term viability as a force within the American economy. With the tailwind of President Trump’s agenda, including steel tariffs, our nominees are confident they will shift the Company’s strategy from hoping to be saved to implementing a multi-year plan that targets meaningful share price appreciation… Please note that despite the sale to Nippon being blocked this month, you – the Board – decided to keep a January deadline for director candidate nominations in an apparent effort to insulate yourselves. We complied with your deadline despite being in the process of amassing a meaningful stake that will be disclosed in due course. Make no mistake, Ancora, as well as Mr. Kestenbaum, intend to build meaningful positions as sale pipe dreams fade and the Company’s share price continues resetting from what have been artificially inflated levels. In closing, our goal here is straightforward: make U.S. Steel great again for the benefit of employees, customers, shareholders and all other stakeholders who want a bright future for this American icon. Only under a new Board and management team do we believe this is possible.”