United States Steel Corporation · NYSE:X
United States Steel — Merger or Acquisition (December 2023)
38 slides from United States Steel's merger presentation, Dec 18, 2023
Slide 1: Acquisition of U.S.Steel
TYO : 5401 OTC : NPSCY(ADR) Dec 18 , 2023 Acquisition of U.S.Steel
Slide 2: Agenda
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 2 １． Overview ２． Rationale ３． Strengths of U.S.Steel ４． Appendix ( Strengths of Nippon Steel) ５． Appendix (Data of U.S.Steel ) Agenda
Slide 3: Moving Forward Together as the Best Steelmaker with World-Leading Capabilities
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 3 Moving Forward Together as the "Best Steelmaker with World - Leading Capabilities" Combines world - leading technologies and manufacturing capabilities to better serve customers worldwide “Best Steelmaker with World - Leading Capabilities” Deliv
Slide 4: Contributions for stakeholders
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 4 Contributions for stakeholders Customers Employees Environment /Sustainability Shareholders All - cash offer of 55$/share for U.S.Steel shareholders, Premium : 40 % to 12/15 $39.33 Enhance Nippon Steel's consolidated profitability and potential
Slide 5: Subsidiary Structure and Offer Terms
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 5 Subsidiary Structure - December 18, 2023: Merger Agreement signed - Approx. Mar. 2024: U.S.Steel Shareholder Vote The transaction is expected to close in the second or third quarter of calendar year 2024, subject to approval by stockholders of U
Slide 6: Impact on Nippon Steel's Financial Statements
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 6 Impact on Nippon Steel’s Financial Statements Cf. 2023.1 - 9result net profit before tax $1,212million/Y (approx. \ 170billion/Y) net profit after tax $975million/Y (approx. \ 140billion/Y) Cash flows Balance Sheet * based on 9/30/23 and include
Slide 7: Agenda
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 7 １． Overview ２． Rationale ３． Strengths of U.S.Steel ４． Appendix ( Strengths of Nippon Steel) ５． Appendix (Data of U.S.Steel ) Agenda
Slide 8: Toward a group with a more global expansion
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 8 Downstream bases Total 16 countries *Simple aggregate of nominal capacities of companies in which NSC has at least 30% stake, As of March 31, 2023 Toward a group with a more global expansion 86 Mt/Y 20 Mt/Y 66 Mt/Y * D ownstream base I ntegrated
Slide 9: This acquisition aligns with Nippon Steel's global strategy
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 9 This acquisition aligns with Nippon Steel’s global strategy To expand steel production into : » Markets where steel demand growth is promising » Markets where Nippon Steel’s technologies and products are highly appreciated To acquire brownfield
Slide 10: Attractiveness of the U.S. Steel Market
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 10 Attractiveness of the U.S. Steel Market Steel demand structure U.S. demand for steel outpaces domestic supply （ 2022CY ） EAF 56 MT/y 69 ％ BF - BOF 25 MT/Y 31 ％ 66 Steel import 29 Mt/Y Self sufficiency69% Steel Export 8 Mt/Y Steel consumption 95
Slide 11: Creating new value by combining the technologies of both companies
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 11 Creating new value by combining the techn ologies of both N ippon Steel and U.S.Steel After acquisition , study the detail of the potential synerg y P roduct T echnologies A uto motive sheets (high - grade), Processing technologies and solution
Slide 12: Shared Commitment: to decarbonize by 2050
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 12 2018 CCUS - 20% Carbon Neutral 102 2013 CCUS - 30% Carbon Neutral Shared Commitment: to decarbonize by 2050 Hydrogen injection into blast furnaces (Implementation of COURSE50 ) Reduction of CO 2 emissions in existing processes Establishment of
Slide 13: Agenda
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 13 １． Overview ２． Rationale ３． Strengths of U.S.Steel ４． Appendix ( Strengths of Nippon Steel) ５． Appendix (Data of U.S.Steel ) Agenda
Slide 14: Overview of U.S.Steel
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 14 Overview of U.S.Steel U.S. Europe Total Headquarters Pittsburgh, Pennsylvania, USA (remain unchanged after acquisition) Manufacturing bases <Flat - Rolled> ： Gary (Indiana ) , Mon Valley (Pennsylvania) , Granite City (Illinois) , Great Lakes (M
Slide 15: Strengths of U.S.Steel
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 15 Strengths of U.S.Steel Extensive U.S. Client base s Well - established history Brand value Excellent Management and employees Strong relationship with unions Good retention ratio Low cost i ron ore mines with abundant reserves Excellent financi
Slide 16: Strengths of U.S.Steel - Strategic Investments
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 16 Strengths of U.S.Steel - Strategic Investments On - time and on - budget, investments focused on expanding the competitive advantages from the raw material process to the finished product process are in progress. In addition to DR - grade pelle
Slide 17: Strengths of U.S.Steel - State-of-the-art Mini-Mill
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 17 Strengths of U.S.Steel - State - of - the - art Mini - Mill » U.S.Steel acquired a 49.9% equity interest of Big River Steel in 2019 and the remaining 51.1% in 2021 » New production line for non - oriented electrical steel sheets began operation
Slide 18: Strengths of U.S.Steel - Flat-Rolled Business Profitability
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 18 Gary （ 7.5 Mst/Y ） Mon Valley （ 2.9 Mst/Y ） Granite City Great Lakes PRO - TEC (JV 50%) UPI Scheduled to shut down in 2023.12 Keetac Minntac 2 BFs shut down . Fairfield Strengths of U.S.Steel - Flat - Rolled Business Profitability » 2015 Fairfi
Slide 19: Agenda
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 19 １． Overview ２． Rationale ３． Strengths of U.S.Steel ４． Appendix ( Strengths of Nippon Steel) ５． Appendix (Data of U.S.Steel ) Agenda
Slide 20: Overview of Nippon Steel
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 20 Overview of Nippon Steel Japan Overseas Total Headquarters Chiyoda - ku Tokyo, Japan Manufacturing bases North Nippon ( Muroran , Kamaishi ), East Nippon ( Kimitsu , Kashima, Naoetsu ), Nagoya , Kansai (Wakayama, Osaka, Amagasaki), Setouchi ( H
Slide 21: Global crude steel production capacity and strategic goal
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 21 * * * 2018 acquisition 2019 acquisition 2014 acquisition 2022 acquisition 2006.12 started to consolidate as an equity method affiliate 2011 acquisition Domestic 6 Works 13 Areas Overseas 15 Countries 51 Companies 2014 2022 After the acquisition
Slide 22: Operating in the U.S. for nearly 40 years
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 22 Operating in the U.S. for nearly 40 years Group company owne rship capacity state 1 1984 Establishment Wheeling Nippon Steel Sheets 100% 0.60 Mt/Y West Virginia Initial : JV with Wheeling - Pittsburgh steel - > Made it a subsidiary in 2008 2 19
Slide 23: Products competitiveness
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 23 Products competitiveness World leading and high value - added product lineups that can contribute to realizing sustainable society Steel product that can enhance energy efficiency of motors Achieving at the same time mutually conflicting motors
Slide 24: Operational and equipment technologies of Nippon Steel
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 24 Operational and equipment technologies of Nippon Steel 100 102 110 111 115 116 119 128 129 Japan South Korea Germany China UK France India Russia The U.S. （ Japan=100 ） Source: RITE 2019 Patent Value Patent Asset Index ＊ NSC Steel company A B C
Slide 25: Nippon Steel's Carbon Neutral Technologies Development
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 25 Around ~2040 Nippon Steel's Carbon Neutral Technologies Development 2022 2025 2027 Yawata EAF (replacement of BF) ~2030 ~2030 2023 Implementation 2024 Around ~2040 Conduct test to verify 30% reduction Advanced CCS projects Survey on the impleme
Slide 26: Breakthrough technologies Nippon Steel challenges
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 26 3 breakthrough technologies Nippon Steel challenges Nippon Steel's goal of a carbon neutral steel production process High - grade steel production in large size EAF Iron making Steel making Hydrogen injection into BF (COURSE50~ Super - COURSE50
Slide 27: Agenda
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 27 １． Overview ２． Rationale ３． Strengths of U.S.Steel ４． Appendix ( Strengths of Nippon Steel) ５． Appendix (Data of U.S.Steel) Agenda
Slide 28: U.S.Steel: History
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 28 U.S.Steel : History 1979 R estructuring (closed 11 works) 1983 R estructuring (closed 33 works) 1984 Withdrew from rails, wires business 1986 U SS - POSCO was established 1990 PRO - TEC was established 1992 Withdrew from shapes, bars business 2
Slide 29: U.S.Steel: Primary Manufacturing bases
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 29 U.S.Steel : Primary Manufacturing bases [ ] is scheduled ( ) is idle or scheduled to close Crude steel capacity* BFs EAFs Hot - rolled sheets Cold - rolled sheets Coated sheets Tin plate Electrical Steel s Seamless tubular North America Integra
Slide 30: U.S.Steel Primary manufacturing bases
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 30 U.S.Steel Primary manufacturing bases Gary <Indiana> (7.5 Mst/Y ) Mon Valley <Pennsylvania> ( 2.9 Mst/Y ) 2BAFs are idle Granite City <Illinois> Fairfield <Alabama> ( 0.9 Mst/ Y ) Big river < Arkansas > ( 3.3 Mst/Y ) Great Lakes <Michigan> PRO
Slide 31: U.S.Steel: Product Mix
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 31 U.S.Steel : Product Mix 42% 31% 11% 8% 5% 2% Service Auto Const. App. Other Cont. Flat - Rolled Mini Mill Tubular Europe 81% 1% 14% 4% Service Auto App. Const. 6% 94% Oil, Gas Const. 30% 16% 28% 11% 6% 8% Service Auto Other Cont. Const. App. 44
Slide 32: U.S.Steel: Volume, Price Trend
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 32 U.S.Steel : Volume, Price Trend 24.2 23.6 22.5 21.8 16.0 15.7 15.9 16.9 15.3 12.7 18.0 16.0 13.2 0 5 10 15 20 25 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023* Mon Valley Fairfield Europe （ Košice ） Graet Lakes Gary Lake Erie
Slide 33: U.S.Steel: Financial Indicator Trends
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 33 U.S.Steel :Financial Indicator Trends 265 247 (1,900) 413 (1,202) (201) 669 1,124 (230) (1,075) 4,946 3,160 1,030 (3,000) (2,000) (1,000) 0 1,000 2,000 3,000 4,000 5,000 6,000 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023* M
Slide 34: U.S.Steel: Balance Sheet, Cash Flows
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 34 (5,130) (101) (20,000) (15,000) (10,000) (5,000) 0 5,000 10,000 15,000 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Units : M$ Benefit obligations Funded status Pension Benefits Plan assets Other Benefits U.S.Steel : Balance Shee
Slide 35: This presentation does not constitute an offer or invitation to subscribe for or purchase
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 35 This presentation does not constitute an offer or invitation to subscribe for or purchase any securities and nothing containe d h erein shall form the basis of any contract or commitment whatsoever. This presentation is being furnished to you s
Slide 36: Additional Information and Where to Find It
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 36 Additional Information and Where to Find It This presentation relates to the proposed transaction between the United States Steel Corporation (“ U. S. Steel ”) and NSC. In connection with the proposed transaction, U. S. Steel will file relevant
Slide 37: Participants in the Solicitation
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 37 Participants in the Solicitation NSC, U. S. Steel and their directors, and certain of their executive officers and employees may be deemed to be participants in the solicitation of proxies from U. S. Steel’s stockholders in respect of the propo
Slide 38: Forward-Looking Statements
© 2023 NIPPON STEEL CORPORATION All Rights Reserved. 38 Forward - Looking Statements This presentation contains information regarding U. S. Steel and NSC that may constitute “forward - looking statements,” as that t erm is defined under the Private Securities Litigation Reform Act of 1995 and other
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