U.S. Steel Corp and Japan’s Nippon Steel announced on Thursday that they have received all necessary regulatory approvals outside the United States for their planned $14.9 billion merger.
The merger, first agreed upon in December, now awaits approval in the U.S., where it faces regulatory scrutiny and political opposition.
Nippon Steel’s bid to acquire U.S. Steel outpaced rivals such as Cleveland-Cliffs, ArcelorMittal, and Nucor. The merger’s domestic approval is under examination by the U.S. Department of Justice, and it faces significant opposition, including from President Joe Biden, who advocates for U.S. Steel to remain domestically owned.
The powerful United Steelworkers union also opposes the merger, citing concerns over potential job losses. In response, Nippon Steel has pledged to honor existing agreements between U.S. Steel and the union. Additionally, Nippon plans to relocate its U.S. headquarters to Pittsburgh, where U.S. Steel is based, to alleviate some of these concerns.
Despite the hurdles, the companies remain optimistic about completing the transaction in the latter half of this year.
“U.S. Steel and Nippon Steel are committed to, as in the months past, continuing to fully cooperate with the examination of the relevant authorities and are determined to complete the transaction,” they stated.
The merger has already received approval from regulatory bodies in the European Commission, Mexico, Serbia, Slovakia, Turkey, and the United Kingdom.
In April, U.S. Steel shareholders voted in favor of the deal. The merger aligns with Nippon Steel’s strategic goal of achieving a global crude steel production capacity of 100 million metric tons. Following the announcement, U.S. Steel shares rose by 1.7%, reaching $37.77 in early trading.
The focus now shifts to securing U.S. regulatory approval to finalize the merger.
