| Course | GSM-7300 Global Strategic Management |
|---|---|
| Module | Module 3 |
| Paper type | Written assignment 3: mergers, acquisitions and international strategy |
| Length | About 1,049 words, 6 pages |
| Format | APA 7 student paper |
| School | Thomas Edison State University |
| Program | Master of Business Administration |
| Updated | October 2026 |
Free sample paper for GSM 7300 Module 3
A 40 Percent Premium and a Golden Share: Nippon Steel's Purchase of U.S. Steel
Student Name
Master of Business Administration, Thomas Edison State University
GSM-7300: Global Strategic Management
Mentor Name
Month Day, Year
A 40 Percent Premium and a Golden Share: Nippon Steel's Purchase of U.S. Steel
Hitt et al. (2024) treat acquisitions and international strategy in successive chapters, but some deals belong to both. When a foreign firm buys a domestic one, the acquisition is also its mode of entry into a new market, and the risks of each strategy compound. Nippon Steel's purchase of U.S. Steel, agreed in December 2023 and completed in June 2025 after a presidential block and a reversal, is a clear example. This paper sets out the deal, explains why Nippon Steel chose an acquisition, weighs the problems the textbook says acquisitions often face, and recommends how Nippon Steel should run its new subsidiary.
The Deal
The main events appear in the company's filings (United States Steel Corporation, 2023; United States Steel Corporation, 2025a; United States Steel Corporation, 2025d).
| Date | Event |
|---|---|
| December 18, 2023 | Agreement at $55.00 per share in cash: equity value about $14.1 billion, enterprise value $14.9 billion, a 40 percent premium to the December 15 close |
| January 3, 2025 | Presidential order prohibits the merger after CFIUS review; the companies sue |
| June 13, 2025 | New presidential order approves the deal; National Security Agreement signed |
| June 18, 2025 | Merger completed; shareholders receive $55.00 per share |
The National Security Agreement commits about $11 billion of new investment by 2028, including a greenfield project, and gives the U.S. government a golden share, a single class of preferred stock carrying rights over governance, domestic production and trade matters (United States Steel Corporation, 2025c; United States Steel Corporation, 2025d). Before the January block, Nippon Steel had already offered that most of the board, the chief executive and the chief financial officer would be U.S. citizens and that capacity at the main plants would not be cut for ten years without approval (United States Steel Corporation, 2025a).
Why Acquire?
The textbook lists reasons firms make acquisitions: to increase market power, overcome entry barriers, reduce the cost and risk of developing new products, increase speed to market, diversify, reshape the firm's competitive scope and learn new capabilities. Overcoming entry barriers is the strongest reason here. The United States has protected its steel market with tariffs for years, so exporting from Japan meant paying them; owning mills inside the country avoids them. Speed matters as well. Building integrated mills and finishing lines from scratch would take most of a decade, while U.S. Steel brought blast furnaces, a modern mini mill, iron ore mines and long customer relationships at once. Nippon Steel, in turn, expected to transfer its technology in high-grade automotive and electrical steels to those plants, which fits the learning motive.
International Strategy and Entry Mode
Hitt et al. (2024) describe five entry modes: exporting, licensing, strategic alliances, acquisitions and new wholly owned subsidiaries built from the ground up. Exporting was blocked by tariffs, licensing would have given away technology without control, and a greenfield plant would have been slow. An acquisition gave the fastest and fullest control. It also carries the most exposure to cultural and political differences. Kogut and Singh (1988) found that the greater the cultural distance between a firm's home and the host country, the more likely firms are to choose joint ventures or greenfield entry rather than acquisition, because integrating an existing foreign organization is hard. Nippon Steel chose the riskier path and then accepted conditions, such as American leadership and a golden share, that reduce the control it paid for. Its international strategy for the U.S. business is therefore closer to multidomestic than global: the subsidiary will be run locally for the local market.
Problems in Achieving Acquisition Success
The textbook warns of integration difficulties, inadequate evaluation of the target, large or extraordinary debt, inability to achieve synergy, too much diversification, managers overly focused on acquisitions and firms that grow too large. Evidence suggests caution. King et al. (2004), in a meta-analysis of post-acquisition research, found that on average acquisitions do not improve the acquiring firm's financial performance. Three risks stand out in this case.
First, the price. Nippon Steel paid a 40 percent premium for a company whose net earnings fell from $2.5 billion in 2022 to $384 million in 2024 on sales of $15.6 billion (United States Steel Corporation, 2025b). With roughly $11 billion of required investment on top of $14.9 billion of enterprise value, the total commitment approaches $26 billion, so synergies must be large to earn an adequate return. Second, integration. Union opposition and political scrutiny mean that the usual tools of integration, such as consolidating plants or moving production, are restricted by agreement. Third, governance. The golden share limits decisions on matters that acquirers normally control, which reduces the value of ownership.
Has It Created Value?
Only about a year has passed since closing, so the answer is not yet known. Hitt et al. (2024) suggest judging an acquisition by whether it achieves its intended synergies and strengthens the firm's competitive position. Reasonable tests are whether the promised investments are made on schedule, whether Nippon Steel's product technology raises the subsidiary's mix of high-value steel and margins, and whether the subsidiary earns more than its cost of capital once the investment program is complete. A student writing later should look for those measures in Nippon Steel's reports.
Recommendation
Nippon Steel should treat U.S. Steel as a partner to be upgraded rather than a unit to be absorbed. That means keeping American management, investing first in finishing lines that use its own technology for automotive and electrical steel, where margins are highest, and staging later spending as returns appear. The trade-off is slower integration and fewer cost synergies in the near term, since plants will not be consolidated and decisions will pass through a board shaped by the security agreement. Given the political conditions and the cultural distance, slower and more local integration is the price of keeping the asset productive.
Conclusion
The purchase shows how an acquisition can also be an international entry mode and how the risks of both strategies add up. Nippon Steel bought speed, scale and a way around tariffs, but paid a large premium and accepted limits on control. Whether the deal creates value will depend on executing the investment program and transferring technology, which is why the textbook's warnings about integration apply with particular force.
References
Hitt, M. A., Ireland, R. D., Hoskisson, R. E., & Harrison, J. S. (2024). Strategic management: Competitiveness and globalization: Concepts and cases (14th ed.). Cengage Learning.
King, D. R., Dalton, D. R., Daily, C. M., & Covin, J. G. (2004). Meta-analyses of post-acquisition performance: Indications of unidentified moderators. Strategic Management Journal, 25(2), 187-200. https://doi.org/10.1002/smj.371
Kogut, B., & Singh, H. (1988). The effect of national culture on the choice of entry mode. Journal of International Business Studies, 19(3), 411-432. https://doi.org/10.1057/palgrave.jibs.8490394
United States Steel Corporation. (2023). Current report on Form 8-K (filed December 18, 2023). U.S. Securities and Exchange Commission.
United States Steel Corporation. (2025a). Current report on Form 8-K (filed January 3, 2025). U.S. Securities and Exchange Commission.
United States Steel Corporation. (2025b). Annual report on Form 10-K for the fiscal year ended December 31, 2024. U.S. Securities and Exchange Commission.
United States Steel Corporation. (2025c). Current report on Form 8-K (filed June 16, 2025). U.S. Securities and Exchange Commission.
United States Steel Corporation. (2025d). Current report on Form 8-K (filed June 18, 2025). U.S. Securities and Exchange Commission.
Reading the GSM 7300 Module 3 assignment instructions
The third GSM-7300 written assignment draws on the textbook's chapters on acquisition and restructuring strategies and on international strategy. Prompts usually ask you to explain why a firm made an acquisition or entered a foreign market, which entry mode it used and whether the move created value. Choose a real deal with public filings and set out its terms and timeline. Then apply the textbook's lists of reasons for acquisitions and problems in achieving success, compare the chosen entry mode with the alternatives, and use research on acquisition performance or entry mode choice. End with a recommendation that names what the firm gives up. Date every event you cite.
Inside the GSM 7300 Module 3 example
The paper treats one deal through two chapters, which is useful when a cross-border acquisition is also an entry mode. A table sets out the timeline from agreement to closing, and the conditions imposed by the security agreement are described with their sources. The analysis tests the textbook's reasons for acquisitions against the facts, rules out alternative entry modes one by one and uses a cultural-distance study to explain the risk of the choice. Three named risks receive their own paragraph. Because the deal is recent, the paper sets out measures for judging value creation instead of declaring success or failure, then closes with a recommendation and its trade-off. Every figure carries a filing citation.
GSM 7300 Module 3 rubric: what earns full marks
This assignment is scored on a 100-point scale. Mentors expect the deal's facts to be accurate and sourced, the textbook's reasons and problems to be applied rather than listed, and the entry mode compared with alternatives. They reward research evidence on whether acquisitions create value and honest treatment of uncertainty when results are not yet known. A recommendation should address the risks the analysis identified and state its trade-off. Clear headings, a timeline or table, and APA citations of filings and journals support a strong grade. Papers that praise or condemn a deal without testing it against the frameworks tend to lose points on critical analysis. Accuracy on dates and figures matters. Balanced judgment earns credit.
Common GSM 7300 Module 3 mistakes, and how to avoid them
A common weakness is describing a deal's news coverage without analyzing its strategy, or listing every reason for acquisitions instead of identifying which apply. Students also forget the international dimension: a cross-border deal is an entry mode, and alternatives should be weighed. Our writers can prepare a GSM 7300 acquisition or international strategy analysis of the deal you choose. Begin with the 8-K filings and press releases that announce the agreement and the closing, which state price, premium and conditions. Then read the acquirer's stated rationale and test it against the textbook. Finish by stating how and when value creation could be measured. Keep the timeline brief and the analysis long.
Write yours, or have the desk draft it
This paper is an original model document written by our desk, not a submitted student paper and not an official Thomas Edison State University document. Read it for the moves, then write your own to the instructions in your classroom. If you want one built to your exact prompt and rubric, the first custom sample is free and arrives in 24 to 48 hours.
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GSM 7300 Module 3 questions, answered
Where can I find a free GSM 7300 Module 3 sample paper?
The third Global Strategic Management written assignment appears above in full: Nippon Steel's acquisition of U.S. Steel analyzed as an acquisition and an international entry mode.
What reasons for acquisitions does Hitt's textbook list?
Increasing market power, overcoming entry barriers, reducing the cost and risk of new product development, increasing speed to market, diversifying, reshaping competitive scope and learning new capabilities.
What are the international entry modes?
Exporting, licensing, strategic alliances, acquisitions and new wholly owned subsidiaries, each with different levels of control, cost and risk.
Do acquisitions usually create value for the buyer?
Research such as the meta-analysis by King and colleagues finds that, on average, acquisitions do not improve the acquiring firm's financial performance, so success depends on the specific deal.
What is a golden share?
A special share held by a government that gives it rights over certain decisions of a company, such as governance or production matters, without owning most of the equity.