Since the prices of steel peaked in August 2021 to more than $1900 per ton, the prices have dropped to under $1000 per ton until the current year 2024.
That coincides with decline in the revenues of the U.S. Steel Corp. (X, Financial) For the nine months period ended in September 2022, the steelmaker made 22.35 billion in revenue; in the same period in 2023 the revenue was down to 18.25 billion; and became only 16.27 billion in the nine months of 2024.
And today we are anticipating Biden's official stance on the Nippon Steel proposal of acquiring U.S. Steel which was first announced in December 2023.
Nippon Steel's proposal to make a full 100% acquisition toward U.S. Steel for $14.9 billion would give significant benefit to U.S. Steel that is now struggling with lower steel prices. The offer includes a 40% premium on U.S. Steel's share price but retain the name and headquarters in Pittsburgh, Pennsylvania.
As with Nippon Steel's advanced technologies and new capital injection, it can assist U.S. Steel in reducing emissions and fulfill the need for sustainability steel manufacturing operation while updating its facilities and
technology for higher productivity and efficiency. The acquisition would also give job security to more than 22,000 American workers related to U.S. Steel.
However, debate sparked on this ordinary business acquisition and turned it into a political and economic concerns from national security, economic sovereignty and the future of steel industry as The Committee on Foreign Investment in the United States (CFIUS) is reviewing the deal for potential threats.
President Biden and President-elect Trump gave the impression that they oppose the acquisition citing national security concerns. They believe that U.S. Steel should remain owned by American. And today we are expecting President Biden's official stance whether to block or approve the deal.
