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U.S. Steel (X) Initiates Review of Strategic Alternatives
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United States Steel Corporation (X - Free Report) announced that its board has taken a proactive step by initiating a formal review process, supported by external financial and legal experts, to thoroughly evaluate various strategic alternatives available to the company.
The review is being conducted in response to multiple unsolicited proposals that have been received by U.S. Steel. The proposals range from the acquisition of certain production assets to consideration for the whole company.
One such proposal to acquire the company was from Cleveland-Cliffs Inc. (CLF - Free Report) , which the U.S. Steel's board has rejected. The board cited several reasons for its decision, including Cleveland-Cliffs’ refusal to sign an non disclosure agreement, which would have allowed U.S. Steel to have further clarity on key issues, such as the valuation of the stock component of the proposal and the regulatory risk. Also, Cleveland-Cliffs is demanding that U.S. Steel agrees to the economic terms of the proposal in advance, which is not something that U.S. Steel's board can do without conducting a due diligence process.
The board of U.S. Steel believes that Cleveland-Cliffs' proposal is unreasonable and it cannot ascertain whether CLF’s proposal properly reflects the full and fair value of the company.
The board is committed to acting in the best interests of the company, its stockholders and its stakeholders. The board is taking actions to gather comprehensive information to assess these proposals effectively, especially those that are in the preliminary stages and subject to ongoing due diligence.
U.S. Steel, which is among the prominent players in the steel space along with Nucor Corporation (NUE - Free Report) and Steel Dynamics, Inc (STLD - Free Report) has strategically invested in state-of-the-art electric arc furnace steelmaking and finishing capabilities, alongside a focus on reducing its carbon footprint. Additionally, the company's financial health has never been stronger, with an emphasis on generating resilient cash flow and prioritizing direct returns to its valued shareholders.
There is no deadline or definitive timetable set for the completion of the review process. There is no assurance that the review will result in the company pursuing a transaction or any other strategic outcome.
U.S. Steel’s second-quarter adjusted earnings per share of $1.92 per share topped the Zacks Consensus Estimate of $1.86. Revenues fell around 20% year over year to $5,008 million in the reported quarter but beat the Zacks Consensus Estimate of $4,942.8 million.
Nucor reported earnings of $5.81 per share for second-quarter 2023, down from earnings of $9.67 per share in the year-ago quarter. Earnings per share, however, topped the Zacks Consensus Estimate of $5.59. NUE recorded net sales of $9,523.3 million, down around 19% year over year. The figure missed the Zacks Consensus Estimate of $9,733.8 million.
Steel Dynamics, however, missed earnings estimates for the second quarter. Its earnings of $4.81 per share lagged the Zacks Consensus Estimate of $4.82. Net sales in the second quarter were $5,081.6 million, which also missed the Zacks Consensus Estimate of $5,405.5 million.
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U.S. Steel (X) Initiates Review of Strategic Alternatives
United States Steel Corporation (X - Free Report) announced that its board has taken a proactive step by initiating a formal review process, supported by external financial and legal experts, to thoroughly evaluate various strategic alternatives available to the company.
The review is being conducted in response to multiple unsolicited proposals that have been received by U.S. Steel. The proposals range from the acquisition of certain production assets to consideration for the whole company.
One such proposal to acquire the company was from Cleveland-Cliffs Inc. (CLF - Free Report) , which the U.S. Steel's board has rejected. The board cited several reasons for its decision, including Cleveland-Cliffs’ refusal to sign an non disclosure agreement, which would have allowed U.S. Steel to have further clarity on key issues, such as the valuation of the stock component of the proposal and the regulatory risk. Also, Cleveland-Cliffs is demanding that U.S. Steel agrees to the economic terms of the proposal in advance, which is not something that U.S. Steel's board can do without conducting a due diligence process.
The board of U.S. Steel believes that Cleveland-Cliffs' proposal is unreasonable and it cannot ascertain whether CLF’s proposal properly reflects the full and fair value of the company.
The board is committed to acting in the best interests of the company, its stockholders and its stakeholders. The board is taking actions to gather comprehensive information to assess these proposals effectively, especially those that are in the preliminary stages and subject to ongoing due diligence.
U.S. Steel, which is among the prominent players in the steel space along with Nucor Corporation (NUE - Free Report) and Steel Dynamics, Inc (STLD - Free Report) has strategically invested in state-of-the-art electric arc furnace steelmaking and finishing capabilities, alongside a focus on reducing its carbon footprint. Additionally, the company's financial health has never been stronger, with an emphasis on generating resilient cash flow and prioritizing direct returns to its valued shareholders.
There is no deadline or definitive timetable set for the completion of the review process. There is no assurance that the review will result in the company pursuing a transaction or any other strategic outcome.
U.S. Steel’s second-quarter adjusted earnings per share of $1.92 per share topped the Zacks Consensus Estimate of $1.86. Revenues fell around 20% year over year to $5,008 million in the reported quarter but beat the Zacks Consensus Estimate of $4,942.8 million.
Nucor reported earnings of $5.81 per share for second-quarter 2023, down from earnings of $9.67 per share in the year-ago quarter. Earnings per share, however, topped the Zacks Consensus Estimate of $5.59. NUE recorded net sales of $9,523.3 million, down around 19% year over year. The figure missed the Zacks Consensus Estimate of $9,733.8 million.
Steel Dynamics, however, missed earnings estimates for the second quarter. Its earnings of $4.81 per share lagged the Zacks Consensus Estimate of $4.82. Net sales in the second quarter were $5,081.6 million, which also missed the Zacks Consensus Estimate of $5,405.5 million.