December 21, 2023

Law360 Quotes Ashley Craig on U.S. Steel-Nippon's Path Forward

2 min

On December 21, 2023, Law360 asked Ashley Craig about the recent agreement by Japanese company Nippon Steel Corp to buy U.S. Steel. According to the article, the $14.9 billion deal received immediate backlash from U.S. lawmakers and union leaders, who hoped U.S. Steel would be acquired by an American entity.

Discussing his initial reaction to the deal announcement, Craig said the purchase price “provides near- and long-term benefits to shareholders.”

“In short, Nippon Steel stepped up and offered the most attractive offering for U.S. Steel,” Craig continued. “Setting aside other issues, such as geopolitical and national security concerns, this seems to be the best offer that U.S. Steel could have entertained.”

Craig also discussed the effects he expects to see if the transaction closes, in the wake of criticism from lawmakers that the deal will have a negative impact on U.S. workers and the U.S. trade deficit.

“One could argue, as U.S. Steel and Nippon Steel have, that this will better position a consolidated, global steel producer that can cater to U.S. government and allied government needs, both military and civil,” Craig said.” However, others will argue that the sale of U.S. Steel to a non-U.S. parent would signify the collapse of a U.S. icon and signal a significant change in direction for a critical industry actor.”

Craig said that given the U.S. market’s “highly consolidated steel-producing sector,” the deal could also raise “competition concerns as to any anticompetitive aspects of the transaction.” He said the Defense Department also could “raise concerns as to how U.S. Steel has and is supporting defense operations—and that a transfer of ownership to a non-U.S. entity could present foreign ownership, control and/or interest complications.”

Click here to access the article.