Ancora Pushes to Oust U.S. Steel Board, CEO over Nippon Deal
An asset management firm, Ancora, is seeking the removal of U.S. Steel's leadership and the quashing of Nippon Steel's acquisition of the company. Ancora holds a stake in U.S. Steel and opposes the proposed deal with Nippon, claiming that the board and CEO David Burritt have prioritized the transaction due to potential personal gains exceeding $100 million.
Earlier this month, Nippon Steel and U.S. Steel challenged the Biden administration's decision to block their $15 billion acquisition on national security grounds. Ancora seeks the appointment of an independent board and a new CEO committed to abandoning the Nippon deal.
In a recent open letter, Ancora announced the nomination of nine independent directors for election at U.S. Steel's annual shareholder meeting. These directors aim to install Alan Kestenbaum, former Stelco Chairman and CEO, as U.S. Steel's new CEO.
Ancora emphasizes that the new board should prioritize U.S. Steel's turnaround rather than exploring alternative bidders or selling the company. The firm also urges pursuing the $565 million breakup fee.
Ancora criticizes the current leadership, stating that "U.S. Steel is now in a dire state due to excessive capital spending, high debt, soft earnings, and a nonexistent contingency plan." The firm believes that "a substantial and urgent reconstitution of the company's leadership is necessary."