The potential sale of U.S. Steel Corp could conclude soon, with final site visits for prospective buyers set for next week. Stakeholders are anticipating the culmination of the two-month strategic review, which may lead to a sale of the entire company or parts of it. The outcome is eagerly awaited by industry players and unions alike, reports Bloomberg
U.S. Steel Corp has been undergoing a strategic review for over two months, considering selling either parts of the company or its entirety. As we move into the next week, site visits for interested buyers are scheduled, suggesting that the decision-making process is nearing its end.
This iconic steelmaker has attracted attention from notable industry names like Cleveland-Cliffs Inc., ArcelorMittal SA, and Stelco Holdings Inc. Despite U.S. Steel rejecting a $7.25 billion offer from Cliffs earlier in August, the forthcoming site visits indicate that Cliffs, among others, is still very much in the running.
The strategic review has not been without drama. ArcelorMittal, one of the potential buyers, faced scrutiny this week after a tragic incident at its coal mine in Kazakhstan. Meanwhile, the United Steelworkers union, representing a significant portion of U.S. Steel's workforce, has the right to counter any offers. They have expressed a preference to transfer this right to Cliffs, explicitly opposing bids from foreign companies, potentially impacting ArcelorMittal's chances.
Adding to the complexity, the Alliance for Automotive Innovation has warned that a merger between Cliffs and U.S. Steel could lead to an entity with substantial control over domestic steel production, which is a critical concern for American car manufacturers reliant on steel supplies.
It's interesting to note that Cliffs and ArcelorMittal have a history of rivalry, with Cliffs having acquired ArcelorMittal's U.S. operations in 2020. This move solidified Cliffs' position in the steel industry, adding to their repertoire after the acquisition of AK Steel Holding Corporation.
Throughout this sale process, U.S. Steel has been tight-lipped, offering no updates during their recent earnings call and sidestepping analysts' queries about the progress. As the industry holds its breath, the coming weeks promise to reveal the future direction of this foundational American steel producer.
The coming weeks are crucial for U.S. Steel Corp as the strategic review draws to a close. With prominent industry players in contention and union interests at stake, the pending sale decisions will significantly impact the landscape of steel manufacturing in the United States.