Nippon Steel has officially completed its $14.9 billion acquisition of US Steel, marking a significant moment in the steel industry and U.S. politics. The deal, which took 18 months to finalize, was announced on Wednesday. It grants President Donald Trump a unique level of influence over the Japanese company’s operations in the United States.
Under the agreement, Nippon Steel purchased all shares of US Steel at $55 each, a price set back in December 2023. As part of the deal, a national security agreement was established with the Trump administration. This agreement allows Trump to appoint a member to US Steel’s board and includes a "golden share" that gives the U.S. government veto power over key corporate decisions.
Eiji Hashimoto, the chairman and CEO of Nippon Steel, expressed gratitude to Trump for his support in securing the acquisition. He noted that the company had to concede a level of control to the U.S. government to move forward with the deal, especially after facing political opposition.
The golden share gives the government authority over various corporate actions, such as halting production, relocating jobs, or changing the company’s name. It also requires government approval for any future acquisitions by US Steel. This move was intended to alleviate national security concerns raised by the Committee on Foreign Investment in the U.S., which reviews foreign investments for potential risks.
Experts warn that such a golden share arrangement could deter foreign investors from engaging with U.S. companies in the future. Despite these concerns, the acquisition is expected to bring $11 billion in investments to US Steel through 2028, including plans for a new mill that will enhance production capacity.
The acquisition not only strengthens Nippon Steel’s position as the fourth-largest steel producer in the world but also allows it to benefit from U.S. infrastructure projects while its competitors face high tariffs. Additionally, Nippon Steel avoids a hefty breakup fee of $565 million that would have been incurred if the deal fell through.
Trump hailed Nippon Steel as a "great partner," while both he and former President Joe Biden had previously expressed opposition to the deal, likely due to its implications for voters in Pennsylvania, a critical swing state. Biden had blocked the deal in January on national security grounds, prompting lawsuits from the companies. However, with the Trump administration’s new review and approval, the deal was finally able to proceed.
As news of the acquisition broke, Nippon Steel’s stock rose by 2.7 percent, reflecting investor optimism about the merger’s potential. Overall, this acquisition not only reshapes the landscape of the steel industry but also highlights the intertwining of corporate decisions and national security in the current political climate.