The U.S. Securities and Exchange Commission (SEC) announced on Friday that it has reached a settlement with industrial conglomerate Esmark Inc. and its chairman, James Bouchard, over a false tender offer made to acquire U.S. Steel Corp.
In August 2023, Esmark, under the direction of Bouchard, proposed a tender offer to purchase U.S. Steel at $35 per share. However, the SEC found that Esmark lacked the financial capability to complete the transaction, as it required $7.8 billion in cash which the company did not have.
Bouchard publicly claimed on a cable news program that Esmark had $10 billion in cash available for the deal and would not use any assets as collateral. The SEC’s investigation determined that these statements were misleading, as Esmark did not possess the funds necessary for the acquisition.
As part of the settlement, Esmark and Bouchard have agreed to cease and desist from future violations without admitting or denying the SEC’s findings. The company will pay a civil penalty of $500,000, while Bouchard will be fined $100,000.
Esmark, a privately held company with interests in steel production, aviation, oil and gas exploration, and real estate, declined to comment when approached by The Associated Press.