Esmark, a privately-held industrial group, announced that it made an offer for US Steel of about $10bn, including debt. This is the second bid in just two days.
James Bouchard’s family-controlled company said Monday it has offered to purchase US Steel at $35 per share. However, it didn’t provide any information on how the deal will be financed or which investment banks and law firms are advising the group.
Esmark’s move comes just a day after US Steel , the North American flat-rolled steel producer with the largest market share, rejected Cleveland-Cliffs’ offer of $35 per share in cash and stock.
Bouchard stated that “this is an exciting period as the American steel industry undergoes restructuring. With Esmark’s history of excellence we are eager to continue growing and well-positioned to operate [US Steel].”
US Steel announced on Sunday that, after receiving numerous unsolicited offers, it had hired advisors to help evaluate “strategic options”. Esmark’s offer was announced on Sunday and the company declined to comment.
US Steel is not for sale, according to people close to the company. They also said that it may remain independent in the end.
In recent years, the North American steel industry has seen a wave consolidation dominated by four companies: Cleveland-Cliffs US Steel Nucor Steel Dynamics.
In recent decades, the industry has been greatly diminished as production moved offshore and Chinese low-cost producers dominated supply.
Steel tariffs introduced by Donald Trump, along with infrastructure and reshoring projects promoted by the Biden Administration have recently made US steelmakers competitive.
US Steel has been associated with the rise in American manufacturing, and is responsible for many of America’s iconic skyscrapers. These include Chicago’s Willis Tower, and the United Nations Building in New York. The share price of US Steel has been stagnant in recent years, but rose by nearly 40% on Monday following the news about the offers.
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