The deal provides U.S. Steel with capital to "redeploy capital to other potential uses, such as strategic acquisition opportunities, debt reduction or voluntary contributions to employee benefit plans," says Thomas Usher, chairman, president and chief executive officer, in a statement. At the same time, the deal secures "a stable, long-term supply of our critical raw material requirements," he adds.

A year ago, US Steel was split from Houston-based Marathon Oil Corp., a move that, according to published reports, cost the steel company several hundred million dollars in debt refinancing. US Steel has publicly announced plans to lead the domestic steel industry in consolidations, and Wall Street analysts have speculated that as many as a half dozen smaller domestic producers could be targets for acquisition.

Charles Gedeon, current executive vice president of raw materials, announces he will resign from US Steel to head the new company. The company formed by Apollo will assume "all collective bargaining agreements, certain benefit obligations and certain other liabilities," according to the statement.