Cheers to Trump for finally authorizing this historic deal.
The Nippon-US Steel Takeover will bring much needed plant modernization to the US.
Nippon Steel and U.S. Steel said Wednesday they have finalized their “historic partnership,” a year-and-a-half after the Japanese company first proposed its deal to buy the iconic American steelmaker for nearly $15 billion.
The pursuit by Nippon Steel for the Pittsburgh company was buffeted by national security concerns and presidential politics in a premier battleground state, delaying the transaction for more than a year after U.S. Steel shareholders approved it. It also forced Nippon Steel to expand the deal, including adding a so-called “golden share” provision that gives the federal government a say in some matters.
“Together, Nippon Steel and U.S. Steel will be a world-leading steelmaker, with best-in-class technologies and manufacturing capabilities,” the companies said.
The combined company will become the world’s fourth-largest steelmaker, and bring what analysts say is Nippon Steel’s top-notch technology to U.S. Steel’s antiquated steelmaking processes. In exchange, Nippon Steel gets access to a robust U.S. steel market, strengthened in recent years by tariffs under President Donald Trump and former President Joe Biden, analysts say.
Nippon Steel and U.S. Steel did not list the full terms of the deal, and did not release a national security agreement struck with Trump’s administration.
But in a statement Wednesday, the companies said the federal government will have the right to appoint an independent director and “consent rights” on specific matters. Those include reductions in Nippon Steel’s capital commitments in the national security agreement, closing or idling of U.S. Steel’s existing domestic facilities and changing U. S. Steel’s name and headquarters.
National Security Concerns
Both Biden and Trump blocked the takeover on national security concerns. Realistically, the national security issue was the opposite of that presented.
US Steel may have shut down or been taken over by Cleveland Cliffs creating a monopoly. Now we have at least some semblance of competition.
Trump amusingly labels the takeover as a partnership, but it’s a takeover with minor twists.
The Associated Press reports Nippon cannot without Trump’s consent to relocate U.S. Steel’s headquarters from Pittsburgh, change the name of the company, “transfer production or jobs outside the United States,” shutter factories, or reincorporate the business overseas.
Notice how petty this is, but the name U.S. Steel is important to Trump.
Nippon will invest $14 billion in modernization, up from $2.7 billion, so give credit to Trump for that.
The president has the authority to name one of the corporate board’s independent three directors and veto power over the other two choices, according to a person familiar with the terms of the agreement who insisted on anonymity to discuss them. The details of the board structure were first reported by The New York Times.
I applaud this deal, how it was accomplished is another matter.
Now, about those tariffs.
Related Posts
January 4, 2025: Biden’s Block of Nippon Steel Merger Makes the United States Less Secure
Biden blocked the Nippon purchase of U.S. Steel. Trump would have too. It’s union pandering that makes the US less secure.
January 6, 2025: Trump Claims Tariffs Will Make U.S. Steel Great Again, He’s Very Wrong
As U.S. Steel and Nippon sue the Biden administration, Trump weighs in on the deal.
February 11, 2025: Trump’s Steel Tariffs Now Will Work as Good as the First Time
Q: How’s that? A: Very poorly.
May 31, 2025: Trump Will Double Steel and Aluminum Tariffs to 50 Percent
Tariff madness continues.
I have written about steel about 8 times this year as a direct subject.
Whatever, this is another TACO.
So, Trump can appoint a director, veto 2 others and then gets decisionmaking/veto power over certain decision. Not consent of FTC or other professionals, Trump personally.
So, communism then.
If you believe in any deal Trump negotiates, I have a bridge to sell you..
They got Trump with the “Golden share” terminology–he’s so easily roped in with anything gold–the plane he begged of of Qatar, his repriced cheap Chinese phone, his gold sneakers, etc…
Glad to see somebody kept the mills going, as opposed to turning them into Superfund Sites.
Good point.
Now all steel will cost about 50% more in the U.S. as pricing is basically set by the government. With Trump having a say over the choice of three directors, the line between government and corporate separation blurts. Speaks of Fascism to those that know what Fascism is.
Unfortunately, U.S. steel does not make many of the products that the U.S. needs, so imports will continue unchanged ~ but all steel will be more expensive.
I guess the only winner is whoever trump appoints to the board of directors and trump for whatever kickback he is getting.
Winning for Trump and his sycophant. Losing for all of America.
Can we change trumps title to “Grifter in Chief”. ???
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Without passing judgement on the positive or negative qualities of this takeover, one thing is certain, with foreign ownership, the profits more than likely will be repatriated to the owning country. That is huge as it means much of the wealth building of the investment needed to fund our consuming economy is transferred overseas. A more optimum arrangement for the United States is to have domestic ownership to rebalance away from an economy too heavily dependent on consumption to greater investment in wealth generating ventures
Profits-after-tax go to shareholders.
Huge Exec salaries/bonuses (C-suite and upper 1% management-core) are paid into the motherland of the company (Japan).
Top 1% of any F500 company do quite well … helps having HQ in your town.
maybe maybe not. why dont you hold other companies to the same standards? Who owns GM stock? Americans, some but also A LOOOOT of foreigners. where the company leadership has nothing to do with who owns and controls the company
This is good news. I read about the Golden Share requirements. They seem to be a very good idea. Looking forward to a lot more foreign investment in the US. I would love to see Trump sign up BYD to manufacture BEVs here in the US. It might even sooth some trade tensions & start a major effort on the part of the Chines to move manufacturing onshore here in the US. This would also light a fire under Ford, GM, Tesla to drive down costs & continue to make their EVs better. Personally, I think this may happen as we approach full commercialization of solid-state batteries which will be much safer in terms of insurance costs related to battery fires.
Fine but BYD must partner with an American company and agree to technology transfers. They must put up the cash also.
Probably the easiest way to do that would be to offer to purchase Chrysler from Stellantis.
I am just applying to them what they applied to us. Is that morally and economically wrong?
Not at all. I was just saying buying Chrysler would make the most sense given the other options are GM, Ford and Tesla.
Oh, I agree. They need to be held to the same standard as GM in China.
For example, they have to lease the land on which they build their factories, among other restrictions, of course.
And then steal Chinese IP.
Cool! We found common ground!
I totally support the adoption of solid state vehicle batteries. This will be the change that is needed to end our dependence on hydrocarbons for travel requirements. Most home rooftops will generate all the electricity needed to keep the home and cars charged. The Solid State leaders are Quantum Scape and BYD.
Not sure whether to say BONSAI or TORAH, TORAH, TORAH
Sayonara next year.
When a government appoints and vetoes board members of a private corporation is when fascism becomes the US.
Citizens United opened to door to Fascism. It is here ~ alive ~ and eating our freedoms alive.
It is ubiquitous in the US and most of the world–military-industrial complex, medical industrial complex, banking, utilities, legal system, NGOs galore, etc. Hell, it’s a crime to buy actual cow milk from your neighbor. The US is 50% fascist & 30% socialist with lingering vestiges of free market. I’m thankful for those vestiges.
As usual, Trump cares more about appearances than substance. The great negotiator is taking a lap because we will call a company, U.S. Steel even if everything concerning the same is happening in Japan. Reality please. The important part is that U.S. Steel is being acquired because of “it’s antiquated steelmaking processes.” Sadly, as the U.S. engages in Trump inspired culture wars fighting over the less than 10 trans college athletes and the deportation of our workforce, we are no longer spending money on education and innovation and are falling behind.
Someone needs to tell Trump that a golden toilet is still a toilet.
I approve the deal, not how it was done.
And depending on wording, much of this golden toilet may be gone in 4 years anyway.
Nippon will not cut production at Granite City Works for at least 2 years
https://www.stlpr.org/economy-business/2025-06-18/nippon-will-not-cut-production-at-granite-city-works-for-at-least-2-years
Mish, Trump more than anyone understands the value of ‘branding’. That’s why he’s insisting on retaining the US Steel name and I agree with him doing that.
This is definitely a solid deal for everyone (US Steel workers, consumers who get choice of steel companies to buy from, improved factories/steel making processes etc).
What we didn’t see in the agreement or maybe it was just not reported is whether this lets Steel from Japan be able to be sold in the US without tariffs and whether there is any limit on the amount that can be shipped.
A golden toilet is still a toilet. A bald man wearing a toupee is still bald. I guess there are still people who believe they can buy the Brooklyn Bridge. Actually, under Trump, a sale of the Brooklyn Bridge could become reality.
All steel billet made abroad brought into the united states faces a 50% tariff right now. thats every country across the board, except for Russia, who’s tariffed at a rate of 200% doesnt matter who ownes the company, and import is an import and will be taxed