(Bloomberg) — United States Steel Corp. shareholders voted in favor of a $14.1 billion takeover offer by Nippon Steel Corp., leaving the fate of the deal for the iconic American steelmaker to the realm of US regulators and politics.
Investors of US Steel approved the Japanese steelmaker’s $55-a-share offer at a special shareholders’ vote Friday that was widely expected to pass, according to an investor on the call. Attention now shifts to a pending US regulatory review for an offer that has become mired in a political firestorm in a US presidential election year.
Nippon Steel agreed in December to buy US Steel at a significant premium, but the deal was quickly met with pushback from union workers who operate most of the Pittsburgh-based steelmaker’s plants and influential politicians who voiced concerns about foreign ownership. President Joe Biden and presumptive Republican presidential nominee Donald Trump both oppose the deal as they vie for blue-collar votes in key swing states ahead of November’s election.
Read More: Japan’s US Steel Takeover Creates Election-Year Firestorm
Biden has called for domestic ownership and announced his support for US workers, raising doubts on whether Nippon Steel can succeed in closing the transaction.
“Irrespective of the shareholder vote, we continue to expect this ultimately is decided by the White House,” Timna Tanners, an analyst at Wolfe Research, said in an interview.
Nippon Steel’s all-cash offer carries a 142% premium to US Steel’s share price on the last day of trading before the US company announced a strategic review.
Beyond politics, the takeover must pass a review by the Committee on Foreign Investment in the United States, or CFIUS. The review is unlikely to conclude until late this year and may extend into 2025, people familiar with the matter said in January. Such a time frame — already much longer than what the companies signaled — thrusts the takeover into the middle of the US election campaign.
US Steel is expected to publish vote results later in a regulatory filing.
–With assistance from Josh Wingrove.
More stories like this are available on bloomberg.com
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Published: 12 Apr 2024, 11:05 PM IST