President Biden Opposes The Acquisition of U.S. Steel – Merger Arbitrage Mondays

United States Steel (X): $38.85

Deal Size: $14.9 B

Market Cap: $8.69 B

The largest week-over-week spread change last week occurred with acquisition of United States Steel (X) by Nippon Steel (NISTF), which saw its spread expand from 15.94% to 41.57%. In fact the stock is now trading below where it was before the merger with Nippon Steel was announced but still well above where it was when rumors of a deal surfaced and a bidding war for the company began.

There were two reasons I was initially not interested in the deal. The first was that U.S. Steel is well known in the industry for being poorly managed and I did not want to get stuck with the company in the event the deal failed. The second had to do with the cross-border nature of the deal and the protectionist sentiment that appears to be sweeping most countries these days.

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