January 2025
Case
HBS Case Collection

U.S. Steel: Proposed Acquisition by Nippon Steel

Format:Print
| Language:English
| Pages:16

Abstract

The case setting is the proposed acquisition of U.S. Steel by Nippon Steel, which elicited a great deal of controversy. The real purpose of the case is to look at the history of the American steel industry since World War II and understand how the steel minimill operators disrupted the integrated steelmakers in a classic Clay Christensen style low-end disruption. The case describes how the minimills initially were limited to products at the low-end of the market for which the technology was good enough, but then as processes steadily improved, these firms were able to address more valuable segments using their lower cost base. This steady improvement over a half a century eventually leads to U.S. Steel acquiring a leading minimill producer, but then the proposed Nippon Steel acquisition raises questions around what should U.S. Steel's strategy be going forward as well as what Nippon Steel's strategt might or should be.