Nippon Steel's Strategic Stake Sale Amidst U.S. Steel Acquisition Drama

Nippon Steel plans to sell its 50% stake in a joint venture plant in Alabama due to political resistance to its acquisition bid for U.S. Steel. The move aims to ease antitrust concerns and expedite regulatory approval. The transaction is conditional on the acquisition going through.

In a bold move to overcome political and antitrust challenges, Nippon Steel declared on Friday its intent to offload its entire 50% stake in a joint venture steel plant in Calvert, Alabama, currently co-owned with ArcelorMittal, should its bid for United States Steel succeed.

The acquisition, initiated last December, faces significant opposition from major U.S. political figures including Vice President Kamala Harris and former President Donald Trump, who both advocate for keeping U.S. Steel firmly under American ownership. The Committee on Foreign Investment in the United States (CFIUS) has extended its review into December, maintaining uncertainty over the deal's future.

Nippon Steel's strategy includes selling its stake to proactively address any potential antitrust concerns. The Japanese steelmaker would register a consolidated loss of 230 billion yen from the sale to ArcelorMittal. However, the sale is contingent upon the success of the U.S. Steel acquisition.

(With inputs from agencies.)