US Steel shareholders approve Nippon Steel's $14.1 billion takeover offer

United States Steel Corp. shareholders voted in favor of a $14.1 billion takeover offer by Nippon Steel Corp., leaving the fate of the deal for the iconic American steelmaker to the realm of U.S. regulators and politics.

Investors of U.S. Steel endorsed the Japanese steelmaker’s $55-a-share offer at a special shareholders’ vote Friday with more than 98% approval, the company said in a statement. The vote was widely expected to pass. Attention now shifts to a pending U.S. regulatory review for an offer that has become mired in a political firestorm in a U.S. presidential election year.

Shares of Pittsburgh-based U.S. Steel fell 2.6% to $41.13 at 1:52 p.m. in New York.

Nippon Steel agreed in December to buy U.S. Steel at a significant premium, but the deal was quickly met with pushback from union workers who operate most of the U.S. steelmaker’s plants and influential politicians who voiced concerns about foreign ownership. President Joe Biden and presumptive Republican presidential nominee Donald Trump both oppose the deal as they vie for blue-collar votes in key swing states ahead of November’s election.

Biden has called for domestic ownership and announced his support for U.S. workers, raising doubts on whether Nippon Steel can succeed in closing the transaction.

“Irrespective of the shareholder vote, we continue to expect this ultimately is decided by the White House,” Timna Tanners, an analyst at Wolfe Research, said in an interview.

Nippon Steel’s all-cash offer carries a 142% premium to U.S. Steel’s share price on the last day of trading before the U.S. company announced a strategic review.

Beyond politics, the takeover must pass a review by the Committee on Foreign Investment in the United States, or CFIUS. The review is unlikely to conclude until late this year and may extend into 2025, people familiar with the matter said in January. Such a time frame — already much longer than what the companies signaled — thrusts the takeover into the middle of the U.S. election campaign.

U.S. Steel and Nippon Steel are mulling a decision to formally push back the time frame they expect to close the deal.

(With assistance from Josh Wingrove.)