United States Steel Corporation · NYSE:X
United States Steel — Merger or Acquisition (December 2020)
17 slides from United States Steel's merger presentation, Dec 8, 2020
Slide 1: United States Steel Corporation to Acquire Remaining Equity of Big River Steel
United States Steel Corporation to Acquire Remaining Equity of Big River Steel www.ussteel.com December 8, 2020 David Burritt President and Chief Executive Officer Christie Breves Senior Vice President and Chief Financial Officer Rich Fruehauf Senior Vice President, Chief Strategy and Development Of
Slide 2: Forward-looking statements disclaimer
These slides are being provided to assist readers in understanding the acquisition of Big River Steel and other strategic and financial actions by United States Steel Corporation. This presentation contains information that may constitute “forward-looking statements” within the meaning of Section 27
Slide 3: Transaction overview
Transaction overview Overview Consideration to Big River Steel Operating Model and Synergies Timing and Closing Requirements ▪ Full ownership of Big River Steel creates North America’s only “Best of Both” steel technology company combining leading advanced high-strength steel intellectual property w
Slide 4: Time is right to accelerate benefits of full ownership
OPTIONALITY ✓ Preserving Big River Steel’s attractive capital structure ✓ Enhancing customer value proposition with differentiated, low-carbon footprint capabilities and entrepreneurial culture ✓ Increasing flexibility to serve current and future customers in expanding Southern U.S. and Northern Mex
Slide 5: Best of Both delivers unmatched value for our stakeholders
“BEST OF BOTH” DELIVERS UNMATCHED VALUE FOR OUR STAKEHOLDERS
Slide 6: Today's action is a significant next step in our Best of Both strategy
Portfolio Shaping ▪ Big River Steel ▪ Footprint Shaping 4 5 To Be ▪ The “Best of Both” integrated and mini mill business models ▪ Improved competitiveness and through cycle cash flow 6 As-Is ▪ Reshaped footprint ▪ Transformed balance sheet ▪ Executing technology and capability driven strategy 1 Fina
Slide 7: Best of Both creates an unmatched value proposition focused on differentiation
✓ Customer-centric innovation Redesigned business model Capital allocation focused on strategy execution ✓ ✓ Acquiring Big River Steel’s leading technology, advanced manufacturing and talented mini mill operators drives significant value creation opportunities Cost Competitiveness low high D if fe r
Slide 8: Validated strategic rationale supports full ownership now
Validated strategic rationale supports full ownership now Combination of: Unique value for : … Our customers … Our stockholders … Our employees Deep customer relationships Industry-leading R&D Intellectual property and know-how Technologically advanced mill Variable cost structure Entrepreneurial cu
Slide 9: Full ownership unlocks additional opportunities
Additional strategic opportunities across key potential sources of value Sources of Value as Minority Owners Sources of Value as Full Owners Collaborating commercially where Big River Steel and U. S. Steel do not compete Limited operational partnering on product and process enhancements Arm’s length
Slide 10: Additional strategic opportunities across key potential sources of value
Deliver Value Capture Potential sources of value Customer Value Supply Chain / Procurement Operational Optimization / Enhancement Corporate Functions Marketing / Branding Capital Spending Flawless Day 1 / Day 100 Execution ▪ Execute in alignment with our S.T.E.E.L. Principles ▪ Focus operating model
Slide 11: Acquisition increases competitiveness of U. S. Steel footprint
Great Lakes 1 Indefinitely idled Mon Valley Gary Keetac Lone Star Tubular Indefinitely idled Lorain Tubular Indefinitely idled Granite City Fairfield Tubular Minntac 1 Great Lakes iron, steelmaking, and hot rolling indefinitely idled. 3.8mnt of raw steel capability. Note: BF = blast furnace, EAF = e
Slide 12: Portfolio of assets creates an unmatched value proposition for stakeholders
= Proprietary advanced high-strength steel finishing technology Differentiated, unique customer value proposition Highly capable, low carbon footprint for advanced high- strength steel substrate ++ Customer- focused, industry-leading research and development Customer focused process innovation to dr
Slide 13: Financial flexibility to execute
FINANCIAL FLEXIBILITY TO EXECUTE
Slide 14: Transaction supported by strong liquidity as of November 30, 2020
Post Transaction U. S. Steel Liquidity Pre Transaction U. S. Steel Liquidity Acquisition Cost Transaction Fees & Other Costs ~ $2,900M -$774M -$40M ~ $2,086M Pre / Post Transaction U. S. Steel Standalone Liquidity1,2: 1 Liquidity includes cash, U.S. credit facility availability, and USSK credit faci
Slide 15: Attractive capital structure remains in place
Flexible and aligned with “Best of Both” strategy Attractive Big River Steel capital structure remains in place Big River Steel Maturity Profile, as of October 31, 2020 ✓ Refinancing and market risk avoided as Big River Steel capital structure is kept in place ✓ Extended maturity profile with ~88% o
Slide 16: Wrap up and Q&A
✓ North America’s only “Best of Both” steel technology company combining leading advanced high- strength steel intellectual property with technologically advanced mini mill operations ✓ Differentiated, low-carbon footprint capabilities and entrepreneurial culture creates new options to enhance our c
Slide 17: Investor Relations
INVESTOR RELATIONS Kevin Lewis Vice President 412-433-6935 klewis@uss.com Eric Linn Senior Manager 412-433-2385 eplinn@uss.com www.ussteel.com
United States Steel — Merger or Acquisition (December 2020) on 6ix