Japan's Nippon Steel to purchase US Steel Corp for $14.1 billion

Nippon Steel of Japan has agreed to purchase US Steel Corp for $14.1 billion, following the steelmaker's rejection of an offer from its primary US rival, the firms announced on Monday.

According to a statement from the firms, the top Japanese steelmaker would buy US Steel for all cash at a price per share of $55, which is 40% more than the company's closing price on December 15 and represents an equity value of roughly $14.1 billion.

The US firm's debt will also be assumed by Nippon, bringing the overall deal value to $14.9 billion.

In August, US Steel initiated a strategic evaluation subsequent to obtaining multiple unsolicited proposals for a partial or complete acquisition.

Cleveland-Cliffs, its primary US rival, made a bid that it rejected, valuing the transaction at about $10 billion.

The United Steelworkers (USW) had declared its endorsement of Cleveland-Cliffs' proposal.

Through the acquisition, Nippon's current production in the US will be greatly increased.

"As a result of NSC's acquisition of US Steel, its expected total annual crude steel capacity will reach 86 million tonnes — accelerating progress towards NSC's strategic goal of 100 million tonnes of global crude steel capacity annually," the statement said.

"We are excited that this transaction brings together two companies with world-leading technologies and manufacturing capabilities, demonstrating our mission to serve customers worldwide, as well as our commitment to building a more environmentally friendly society through the decarbonisation of steel," Nippon Steel president Eiji Hashimoto said.