Ancora Bows Out of U.S. Steel Boardroom Battle Amid Potential Japanese Takeover

Ancora Holdings abandoned its proxy fight with U.S. Steel following indications that a Japanese takeover could proceed. The firm had sought to replace the CEO amid a previous blockade on the deal, but recent developments and investor sentiment have led Ancora to shift its strategy and withdraw its board candidates.

In a dramatic turn of events, investment firm Ancora Holdings has stepped back from its boardroom battle with U.S. Steel, following recent signs that a prospective Japanese takeover might be resurrected. The firm, holding roughly 1% of U.S. Steel's shares, had initiated a proxy fight earlier in the year seeking the ouster of the steelmaker's CEO after the Biden administration blocked a proposed sale to Japan's Nippon Steel.

This week, Ancora took the unusual step of withdrawing its nine director candidates, effectively dismantling one of the year's most anticipated corporate battles. With stock prices stable at around $44 per share, the firm's focus has shifted toward ensuring the best outcomes for stakeholders, as articulated in Ancora's Wednesday statement. The withdrawal follows phone discussions with key investors indicating limited support for Ancora's campaign.

The situation intensified after President Trump directed a national security review of Nippon's bid for U.S. Steel, causing a reassessment by Ancora and other investors. Despite previous successes in securing board positions in major companies like LKQ and Norfolk Southern, Ancora opted to preserve its reputation and avoid further distraction, underscoring the complex landscape of international corporate negotiations.

(With inputs from agencies.)