Ancora withdraws from anti-US Steel merger campaign after Trump orders review of Nippon deal
(Reuters) – Activist investor Ancora Holdings said on Wednesday it was ending its campaign to overhaul U.S. Steel’s board of directors after President Donald Trump ordered a review of its proposed takeover from Japan’s Nippon Steel on national security grounds.
The announcement came just a day after U.S. Steel said Ancora, which currently owns less than 1% of the company, had changed its stance and expressed support for the merger, which Ancora had previously opposed.
Ancora had previously floated an alternative plan that included a possible cash offer of up to $75 a share — significantly higher than Nippon Steel’s proposed $55 a share. However, in a statement, Ancora said it had “no intention of disrupting” the ongoing deal between U.S. Steel and its Japanese partner.
The investor also stressed that the decision to halt the campaign was based on its assessment that the parties involved had taken proactive steps to mitigate national security risks – a key factor that could affect the deal’s approval.
-Trump’s intervention raises new hopes for the deal
On Monday, former President Donald Trump – the Republican frontrunner in this year’s election – directed the Committee on Foreign Investment in the United States (CFIUS) to conduct a thorough review of Nippon Steel’s proposed takeover, to assess whether “further action” is needed to protect the national interest.
The move is seen as a significant turning point, as Mr. Trump had previously publicly opposed the deal, emphasizing the importance of protecting strategic businesses and ensuring that domestic supply chains are fully controlled by Americans.
U.S. Steel – an industrial icon more than 123 years old – has long been considered one of the most strategic assets for the US economy, especially in the context of geopolitical tensions and increasing shifts in global supply chains.
-Ancora's campaign ends after months of pressure
Ancora initiated a battle for control of U.S. Steel's board of directors in early 2024, including nominating nine new members to replace the current leadership, including CEO David Burritt. The investor has called for the annual shareholder meeting, currently scheduled for May 6, to be delayed until after June 18 while strategic alternatives to the Nippon deal are considered.
Ancora’s withdrawal opens the door for approval of the $14.1 billion Nippon Steel deal, which has been met with skepticism from both politicians and investors.
-Is US Steel (X) Undervalued?
As the name “X” – the stock symbol for U.S. Steel – continues to make headlines, investors are starting to ask: Is the company undervalued relative to its true potential?
According to the latest analysis from AI-powered financial data platforms like InvestingPro, US Steel’s stock is not among the most promising stocks in terms of valuation or earnings growth. This may raise doubts that the current valuation reflects much of the prospects and risks associated with the Nippon deal.
However, with Ancora’s withdrawal and the US government’s review, the coming weeks could be another volatile period for X shares – as the market awaits further clarity from CFIUS and regulators.