Steel, who is hindering Nippon Steel’s plans in the USA
Nippon Steel, a large Japanese steel group, will postpone the acquisition of the American steel company Us Steel until after the elections. The operation turned into a huge political case – all the details
Nippon Steel, the largest Japanese steel group, announced last Friday that it will postpone the acquisition process of the American steel company US Steel for three months. The operation, therefore – which has become a major political case in the United States – will be completed in December, after the presidential elections on 5 November.
POLITICAL OPPOSITION TO THE NIPPON STEEL-US STEEL AGREEMENT
Regardless of who returns to the White House, however, the prospects do not appear to be too positive for Nippon Steel: Donald Trump has promised that he will block the agreement (worth around 15 billion dollars), while the current president Joe Biden he sided with the unions opposed to the buyout . National security issues have also been raised, even though Nippon Steel is a Japanese company and Japan is a major US ally.
Nippon Steel's motivation appears to be exclusively economic: by acquiring US Steel (the third largest steel producer in the country), the Japanese group (which is the fourth largest steel producer in the world) will in fact come closer to achieving a global production capacity of one hundred million tons.
THE REASSURANCES OF THE JAPANESE GROUP
Nippon Steel has tried in various ways to reassure US political circles and public opinion: it said that the acquisition will allow US Steel to produce steel through new, low-emission processes; guaranteed that the headquarters will remain in Pittsburgh and that there will be no layoffs; He specified that the agreement will improve the resilience of American industry, allowing it to better face competition from China.
The company, however, clarified that the decision to postpone the operation is not linked to the political context but to the authorization times.
WHAT SHAREHOLDERS DO, WHAT THE AMERICAN GOVERNMENT DOES
In April, the majority of US Steel shareholders – such as the Vanguard, BlackRock, Dimensional and Pentwater funds – voted in favor of the acquisition, which however will have to be reviewed by CFIUS, a federal agency tasked with assessing the implications on national security of foreign investment in the United States.
The day before notifying the postponement of the operation to December, Nippon Steel announced that it had received a new notification ( second request , in jargon) from the Department of Justice, which requested further details and documents as part of an antitrust review .
Meanwhile, the European Commission today approved the Nippon Steel-US Steel operation through a simplified procedure.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/mondo/nippon-steel-rinvio-acquisizione-us-steel/ on Mon, 06 May 2024 14:06:20 +0000.