Advisory firms endorse Nippon Steel acquisition of USS

Two independent proxy advisory firms recommend that US Steel shareholders vote in favor of Nippon Steel Corporation’s (NSC) acquisition offer at the Pittsburgh, Pennsylvania-based steelmaker’s 12 April special meeting, Kallanish learns from a US Steel press release.

The advisory firms highlight shareholder advantages of agreeing to the transaction, including its meaningful value premium and nature of Nippon Steel’s all-cash offer.

“The sales process was thorough, shareholders are receiving a sizable premium, there is a potential downside risk of non-approval, and there is certainty of value in NSC’s cash offer,” indicates a 27 March report by Institutional Shareholder Services (ISS).

The second firm, Glass Lewis, addresses the political and antitrust concern surrounding the transaction in their report.

“As it relates to the political/regulatory element, we believe USS has negotiated adequate procedural safeguards and remedies intended to give the NSC deal the best possible opportunity of securing necessary approvals,” Glass Lewis asserts in its report on 27 March.

US Steel’s statement highlights the ISS and Glass Lewis support and expresses additional reasons to vote in favor of the pending transaction with Nippon Steel.

“Through increased financial investment and NSC’s contribution of advanced technologies, Nippon Steel will advance American priorities by driving greater quality and competitiveness for customers in the critical industries that rely on American steel while strengthening American supply chains,” US Steel’s statement says.

US Steel shareholders of record at the close of business on 4 March will be entitled to vote at the special meeting, including by submitting a proxy in advance of the meeting.

John Isaacson USA