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Nippon Steel aims to complete USD 15 billion U.S. Steel acquisition by year-end

Nippon Steel, Japan's largest steel producer, is trying to finalize the U.S. Steel deal by the end of the year.

Nippon Steel aims to complete USD 15 billion U.S. Steel acquisition by year-end

Nippon Steel, Japan’s largest and the world’s fourth largest steelmaker plans to complete its USD 15 billion acquisition of U.S. Steel by year-end. The deal is said to be key to Nippon Steel’s growth strategy. It was finalized in December 2023 and has faced obstacles from prominent figures such as Trump and Biden, as well as the United Steelworkers labor union.

Trump, who won the November election, had vowed to block the deal if he returned to the presidency. On the other hand, Nippon Steel has taken steps to convince its stakeholders of this process by making various commitments regarding jobs and investments in the U.S. and announced that it will divest its stake in a steel mill in the U.S. if the deal is completed.

The Committee on Foreign Investment in the United States (CFIUS) has extended its review of the deal until the end of the year. Nippon Steel Vice President Takahiro Mori stated that the process should not be delayed after the elections and that the agreement will contribute to cooperation between the US and Japan. Nippon Steel had appointed former US Secretary of State Mike Pompeo as an advisor to facilitate this process. After the acquisition, the company aims to strengthen its presence in the US high-quality steel market and increase its annual production capacity from 65 million to 85 million tons.

Despite economic pressures from external factors, Nippon Steel announced that it will maintain its dividend target of 160 yen (approximately USD 1.06) per share for the full year. However, it revised its net profit forecast for the fiscal year ending in March from 340 billion yen (approximately USD 2.26 billion) to 310 billion yen (approximately USD 2.06 billion). In addition, the company's net profit decreased by 19% compared to the previous year, reaching 243.4 billion yen (approximately USD 1.62 billion) in the six months ending September 30.

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