US Steel shareholders approve Nippon buyout
The major American steel manufacturer US Steel said last week its shareholders had “overwhelmingly” voted to approve a US$14 billion acquisition proposal by Japan’s Nippon Steel, a move President Joe Biden opposes.
A US Steel press release said that more than 98% of the shares voted in favour of Nippon Steel’s buyout bid, a figure which represented 71% of all outstanding stock.
“The overwhelming support from our stockholders is a clear endorsement that they recognise the compelling rationale for our transaction” with Nippon, US Steel CEO David Burritt said in a statement after the vote.
“This is an important milestone as we progress toward completing the transaction.”
The merger deal, coming in a presidential election year, has become pulled into political debate over foreign ownership of American companies and struggles in the US manufacturing industry.
Democrat Biden, who won the backing last month of the US steelworkers union, is competing against Republican opponent Donald Trump for support among working-class voters – especially in key swings states such as Pennsylvania, where US Steel is headquartered.
Last month Biden came out against the deal, saying it was vital for US Steel “to remain an American steel company that is domestically owned and operated”.
He did not, however, say he would block the deal, which has been under a federal review of how it affects national security interests since it was announced in December.
Trump, meanwhile, said in February that he would halt the “horrible” deal if he wins a second White House term.
Clearly aware of the political backdrop, Burritt reiterated last Friday that the transaction would “maintain the US Steel name and Pittsburgh headquarters, with even more capital to invest in Pennsylvania”.
Trump narrowly won Pennsylvania in the 2016 US presidential election, but Biden was able to retake it in 2020, also by a small margin.
US media outlet Politico reported last Wednesday that the Justice Department had launched a formal antitrust investigation into the deal, citing two people with direct knowledge of the matter.