PITTSBURGH (TNS) — United States Steel Corp. and Nippon Steel Corporation said Thursday that they have received all regulatory approvals outside the U.S. for Nippon’s proposed $14.9 billion purchase of the iconic Pittsburgh-based steelmaker.
More work remains before approval is secured in the U.S. Two federal agencies, the Committee on Foreign Investment in the United States and the U.S. Justice Department, are reviewing the sale to make sure it doesn’t establish a monopoly or threaten national security. The DOJ review is likely related to Nippon’s joint stake in a large Calvert, Ala., plant, operated with ArcelorMittal, which competes directly with U.S. Steel to supply metal for the automotive sector.
U.S. Steel President and CEO David Burritt said the company is pleased with the regulatory approvals “as they are a clear indication that the transaction with Nippon Steel is pro-competitive and supports the strategic merits of foreign investment.
“Together with Nippon Steel, U.S. Steel will become a world-leading steelmaker with enhanced technologies and resources to support a stronger steel industry with enhanced competition,” he said in a prepared statement. “This deal is the best deal for American steel, the best deal for American jobs and the best deal for America’s ability to create an even stronger alliance with Japan against China.”
The approvals announced Thursday come from the Directorate-General for Competition of the European Commission, the Mexican Federal Economic Competition Commission, the Serbian Competition Commission, the Ministry of Economy of Slovakia, and the Turkish Competition Authority, the companies said.
Analysts said the foreign approvals were expected, and much less consequential than the U.S. reviews, which fall during an election year. The European Union cleared the deal earlier this month.
“I don’t think anyone was really worried about that,” said Twin Capital Management analyst Adam Simon. “I’m kind of shocked it’s actually trading well off of it.”
He said U.S. Steel’s stock took a hit after Lourenco Goncalves, CEO of rival bidder Cleveland-Cliffs, speculated that the deal would come up at next month’s presidential debate. The plunge was “kind of silly, unless it actually happens,” Simon said.
Takahiro Mori, the head of global business development at Nippon Steel, said Nippon’s goal for the deal is “to protect and grow U.S. Steel. We are confident that this transaction will be for the benefit of all of U.S. Steel’s stakeholders, including customers, employees, suppliers, and communities.”
Mori spent last week touring Pennsylvania and Washington, hoping to combat widespread political opposition to the deal by spreading his message that the proposed deal will strengthen U.S. Steel.
“I don’t care about the noises or criticism because I’m very confident that our deal is the best,” he said in an interview with the Post-Gazette.
But President Joe Biden recently promised to keep U.S. Steel in American hands, while former president and Republican presidential candidate Donald Trump said in February that as president he would block the deal “instantaneously,” calling it “a horrible thing.”
U.S. senators from opposite parties also opposed the deal, including Pennsylvania’s John Fetterman and Bob Casey, both Democrats. Fetterman called the deal “outrageous” when it was announced in December and Casey said the sale “appeared to be a bad deal for Pennsylvania and Pennsylvania workers.”
U.S. Steel and Nippon Steel initially planned to close in the second or third quarter, but have since pushed the timeline back to the third or fourth quarter.
