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In the face of mounting resistance from the Biden administration and the United Steelworkers (USW) union, Nippon Steel Corp (OTC:NISTY) is intensifying efforts to secure the acquisition of United States Steel Corp (NYSE:X).
What Happened: Vice Chairman Takahiro Mori of Nippon Steel is set to return to the U.S. for further discussions concerning the proposed acquisition of U.S. Steel. This move follows a previous visit in May, which underscores the company’s determination to finalize the deal despite regulatory and political hurdles, Reuters reported on Monday.
During his upcoming visit, Mori plans to engage in discussions in Washington D.C. and is open to the possibility of selling off certain assets to gain approval from U.S. regulators.
Although the deal has received regulatory nods outside the U.S., it is facing opposition from President Joe Biden who wants U.S. Steel to remain under domestic ownership. The USW union has also expressed concerns about potential job losses.
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Mori indicated that Nippon Steel might consider divesting assets if required by U.S. regulators to approve the deal. However, he downplayed the necessity of such sales for the deal’s closure.
Why It Matters: The proposed $14.9 billion merger between Nippon Steel and U.S. Steel has been met with strong opposition. The deal, initially expected to close by mid-2024, has been delayed due to political resistance and ongoing investigations.
Despite the controversy, Nippon Steel has remained resolute in its plans. The company has reassured that the merger will not lead to job losses or plant shutdowns. Mori believes the takeover process would run more smoothly after the U.S. presidential election, no longer a political issue.
Given the significance of the U.S. market, the completion of this deal could significantly impact Nippon Steel’s future financial goals. The company’s annual business profit could see a boost of 150 billion yen ($954 million) or more if the deal is completed by the end of December as planned.
Image by Poetra.RH via Shutterstock
This story was generated using Benzinga Neuro and edited by Pooja Rajkumari
