M&A News: U.S. Steel Stock (X) Fires Higher as $15B Nippon Takeover Verdict Gets Closer

Shares in U.S. Steel (X) strengthened today as President Trump’s decision on whether to give the green light to its $15 billion takeover by Japan’s Nippon Steel moved closer.

Final Decision Looms

According to a Reuters report, the Committee on Foreign Investment in the United States (CFIUS) has submitted a recommendation on the deal to Trump. The President now has 15 days to make a final decision, although this timeline could slip.

The CFIUS reviews foreign investment for national security risks.  In January former President Biden blocked the deal following a previous CFIUS-led review on national security grounds.

The companies sued, arguing they did not receive a fair review process. However, Biden rejected their views.

Nippon Steel said recently that its core proposal to acquire full ownership of U.S. Steel remains the starting point in negotiations with U.S. authorities, though the company is also exploring various proposals to secure approval.

Nippon Needs Deal

Earlier this week it was reported that Nippon Steel was ready to invest $14 billion in U.S. Steel’s operations including up to $4 billion in a new steel mill if Trump approved the merger bid. That would seemingly fit with Trump’s strategy of pumping more investment into U.S. manufacturing and industry.

Indeed, analysts believe that the most likely outcome is that U.S. Steel and Nippon Steel will work with the Trump administration to secure an investment deal instead of a takeover or merger.

Nippon Steel is certainly keen to close the deal, as the company is facing a $565 million breakup fee if it falls through. That’s something it doesn’t need alongside a 25% tariff on imported steel.

Is X a Good Stock to Buy Now?

On TipRanks, X has a Hold consensus based on 1 Buy and 4 Hold ratings. Its highest price target is $50. X stock’s consensus price target is $43 implying an 2.33% upside.

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