Nippon Steel finalizes deal to make US Steel wholly owned
TOKYO (Kyodo) -- Nippon Steel Corp. said Wednesday it has finalized a $14.1 billion deal to acquire United States Steel Corp. as a wholly owned subsidiary after U.S. President Donald Trump reversed his initial opposition and allowed the deal to proceed.
The move will give Japan's largest steelmaker, and the world's fourth-largest, greater access to the growing U.S. market for high-grade steel, with U.S. Steel issuing a golden share to the U.S. government that grants veto power over key management decisions.
"Together, Nippon Steel and U.S. Steel will be a world-leading steelmaker, with best-in-class technologies and manufacturing capabilities," the two companies said in a joint statement.
Nippon Steel said it has concluded a National Security Agreement with the U.S. government and pledged to invest around $11 billion by 2028 in the iconic but struggling Pittsburgh-based company.
Under the agreement, the U.S. president or a designated official will have the right to approve certain management decisions, including the closure or idling of U.S. Steel's existing manufacturing facilities in the United States.
U.S. Steel will keep its headquarters in Pittsburgh, with a majority of its board of directors composed of U.S. citizens and key management positions, including the CEO, held by Americans.
U.S. Steel will also maintain its capacity to produce and supply steel from its production locations in the United States to meet domestic market demand.
"This framework will enable Nippon Steel to secure management flexibility and profitability at U.S. Steel while protecting U.S. national security," they said in the statement.
Nippon Steel Vice Chairman Takahiro Mori, who will also serve as U.S. Steel chairman, said he shares Trump's "commitment to protect the future of the American steel industry, American workers, and American national security."
Trump had firmly opposed Nippon Steel's bid to acquire U.S. Steel, which was first announced in December 2023, both during his 2024 presidential campaign and after taking office.
To ease U.S. national security concerns, Nippon Steel said Americans will make up the majority of U.S. Steel's board and that it will not carry out layoffs or shut factories.
It also raised its planned investment in U.S. Steel to $11 billion, 10 times the original amount, a move that likely helped secure Trump's approval for the purchase.
Trump signed a presidential order Friday modifying former President Joe Biden's decision to block the sale of U.S. Steel to Nippon Steel. The order said the national security risks associated with the Japanese company's acquisition could be "adequately mitigated" if the conditions set by the U.S. government are met.
The takeover had support from U.S. Steel, its shareholders, and parts of its workforce and local communities.
On Wednesday, David McCall, president of the powerful United Steelworkers union, which has persistently opposed the buyout, said in a statement, "We will continue watching, holding Nippon to its commitments."
Despite opposition from both Biden and Trump, Nippon Steel continued to pursue full ownership of U.S. Steel, arguing that partial control could risk the leakage of its cutting-edge technologies.
Founded in 1901, U.S. Steel was once a symbol of American economic prowess, but it has struggled to keep up with competition from Chinese and other foreign rivals.
Facing a shrinking domestic market due to a declining population, Nippon Steel has increasingly focused on overseas expansion, carrying out mergers and acquisitions in countries such as India and Thailand. Its goal is to boost annual steel output to 100 million tons.
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