Posted By Jessica Weisman-Pitts
Posted on December 26, 2024
TOKYO (Reuters) – Japan’s Nippon Steel said on Thursday it has extended the closing date for its $14.9 billion purchase of U.S. Steel as U.S. President Joe Biden weighs whether to block a deal that has faced intense opposition since it was announced.
The closing date was revised to the first quarter of 2025 from the third or fourth quarter of 2024 previously.
Nippon paid a hefty premium to clinch the deal last December in an auction, but the deal faced opposition from the powerful United Steelworkers union (USW), as well as politicians.
Biden has said he wants U.S. Steel to be domestically owned and operated, while President-elect Donald Trump has vowed to block the deal after he takes office in January.
On Monday, the committee that vets foreign deals in the U.S. for security concerns referred the decision whether to approve or block the deal to Biden. He has 15 days to decide, and if he takes no action, the merger will get an unexpected green light.
“Nippon Steel hopes that the President will use this time to conduct a fair and fact-based evaluation of the acquisition. We remain confident that the acquisition will protect and grow U.S. Steel,” the company said on Thursday.
U.S. Steel shares were up 1.7% before the bell. They have never hit the offer price of $55 per share, signaling investor worries over the timeline for the deal’s completion.
Japan Prime Minister Shigeru Ishiba urged Biden to approve the merger to avoid marring recent efforts to strengthen ties between the countries, Reuters reported in November.
Nippon also said on Thursday the review process of the antitrust division of the U.S. Department of Justice was also underway, without specifying when it may end.
Despite the opposition, U.S. Steel shareholders overwhelmingly voted in April to approve the acquisition.
The two companies have also worked to assuage concerns over the combination. Nippon has offered to move its U.S. headquarters to Pittsburgh, where the U.S. steelmaker is based and promised to honor all agreements in place between U.S. Steel and USW.
(Reporting by Rocky Swift and Katya Golubkova and Aatreyee Dasgupta in Bengaluru; Editing by Himani Sarkar, Muralikumar Anantharaman and Sriraj Kalluvila)
