United States Steel Corp. Chief Executive Officer David B. Burritt sold shares of the company worth $12.6 million, a move that was part of a plan made before a recently announced sale to Nippon Steel Corp. and was triggered by a rally in the stock price.
In a filing with the Securities and Exchange Commission, Burritt reported he sold 252,458 shares at $50.013 on Monday, the day of the $14.1 billion deal. US Steel closed Wednesday down 1.2% at $47.82 a share, about a 13% discount to the $55 offer from Nippon Steel.
While the deal was received well by investors — shares surged 26% Monday — it was opposed by key Democrats and the United Steelworkers, who are close to President Joe Biden.
Burritt’s transaction is allowable under SEC rules and was part of a pre-determined plan before the deal was announced.
“Dave has a 10b5-1 plan, which was established in early June as part of his personal financial planning. The plan provides for stock sales at pre-established prices,” US Steel spokeswoman Amanda Malkowski said in an email. “When Dave established the plan, U.S. Steel was trading at $22.63. The sale price in the plan was set for $49.87, which the company crossed with the merger news, thus triggering the sale.”
Many executives file 10b5-1 trading plans to signal in advance they’re going to sell shares in a prescribed time window and certify that the sales aren’t based on material nonpublic information. The plans allow executives to sell in a predictable pattern, which can minimize spooking other investors.
