Activist investor Ancora Holdings has built a stake in US Steel and wants the steelmaker to drop its merger agreement with Japan’s Nippon Steel, the Wall Street Journal reported on Sunday, citing sources.
The exact size of Ancora’s stake in US Steel could not be determined. The activist investor also intends to rally shareholders around a plan to oust US Steel’s top boss David Burritt, the report said.
Ancora is not interested in pursuing a sale of the American steelmaker to another party, the WSJ reported, adding that it has nominated nine director candidates to the company’s 12-person board, including Stelco’s former chief Alan Kestenbaum.
Bloomberg News reported that the hedge fund also wants Kestenbaum to replace Burritt as the CEO.
Ancora, US Steel and Nippon Steel did not immediately respond to Reuters’ request for a comment outside regular business hours.
Earlier this month, former US President Joe Biden blocked Nippon Steel’s $14.9 billion deal for US Steel on national security grounds and delayed an order until June for Nippon to abandon the bid.
The companies have sued the Biden administration for blocking the acquisition.
U.S President Donald Trump had also voiced opposition to Nippon Steel acquiring US Steel.
“I will block this deal from happening,” Trump wrote on social-media platform Truth Social in December.
Reuters reported earlier this month that rival steelmaker Cleveland-Cliffs was partnering with peer Nucor for a potential all-cash bid for US Steel.
Cliffs had previously proposed acquiring US Steel, but the American steelmaker raised concerns about antitrust issues and the consolidation of steel supply to US automakers. A potential deal could result in up to 95% of US iron ore production being controlled by a single company.
Previously, Ancora pushed for changes in other companies including C.H. Robinson, Norfolk Southern, and Forward Air Corp.
(Reporting by Gursimran Kaur in Bengaluru; Editing by Subhranshu Sahu and Sherry Jacob-Phillips)
