Latest news with #Hashimoto
Qatar Tribune
18 hours ago
- Business
- Qatar Tribune
Nippon Steel-US Steel deal closes with United States safeguards
Agencies Nippon Steel completed its multi-billion-dollar acquisition of US Steel on Wednesday, granting rare veto-like power over strategic decisions to Washington with a 'golden share'. The announcement concludes a saga that began in December 2023, when Nippon Steel agreed to acquire the linchpin of American steelmaking for $14.9 billion. An outright buyout sparked bipartisan political opposition, including from President Donald Trump, who railed against the proposed deal throughout the 2024 presidential campaign. But last month he announced a pivot, branding the revamped venture—blocked by former president Joe Biden on security grounds—as a 'partnership' rather than a takeover. A national security agreement between the companies and the US government provides that approximately $11 billion in new investments will be made by 2028. And Washington's non-economic golden share allows it to appoint one independent director as well as granting consent rights for proposed capital budget cuts among other powers. Nippon Steel CEO Eiji Hashimoto said Thursday in Tokyo that this 'won't hinder activities that we hope to conduct.' 'The agreement is fully satisfactory to us, as it ensures the management freedom... essential for business investment,' Hashimoto told reporters. 'We intend to start implementing measures for revitalization and development as soon as possible,' he said, promising not to 'transfer jobs and production sites elsewhere.' It is 'only natural' that the US government would be concerned about the takeover of a symbolic company, which dates back to 1901, Hashimoto added. A source close to the matter said Nippon Steel had bought all common shares of US Steel, completing the merger. The deal creates the world's fourth biggest steelmaker—but Nippon Steel faces several big challenges, from trade tariffs to weak demand for steel products worldwide. Nippon Steel shares were up 2.4 percent Thursday afternoon, even as Tokyo's benchmark Nikkei index slumped 0.9 percent. Pennsylvania Senator Dave McCormick, a Republican, thanked Trump on X and called the outcome 'a massive victory for working families in the Mon Valley, our economy, our national security, and America's manufacturing future!' But the United Steelworkers (USW) union, which vigorously fought the deal, vowed to 'continue watching, holding Nippon to its commitments,' according to a statement. 'We will use the most powerful tool workers have against global corporations: collective bargaining.' Biden had blocked the transaction in early January, shortly before leaving office. He said that placing 'one of America's largest steel producers under foreign control' could 'create risk for our national security and our critical supply chains.' Besides agreeing to keep US Steel's Pittsburgh headquarters and to maintain US production, the national security agreement calls for a majority of US Steel's board to be US citizens, as are key leaders including the CEO. The 'golden share' does not entitle the US government to dividends, nor does it require Washington to make investments in the company. While the structure gives the government 'extraordinary' influence, the mechanism could be difficult to enforce in a downturn if Nippon fails to comply, said Atlantic Council senior fellow Sarah Bauerle Danzman.
Kyodo News
a day ago
- Business
- Kyodo News
Nippon Steel confident management freedom ensured in U.S. Steel deal
KYODO NEWS - 7 hours ago - 15:07 | All, Japan, World Nippon Steel Corp.'s top executive Eiji Hashimoto said Thursday that the U.S. government's role set under its $14.1 billion buyout of United States Steel Corp. "will not hamper" the U.S. unit's business going forward. At a press conference in Tokyo, Hashimoto said $11 billion of investment in U.S. Steel operations -- 10 times more than the initial plan -- and a golden share issued to the U.S. government that allows it to veto key management decisions among other conditions are rational, even as analysts view them as downside risks to U.S. Steel's management. "There would be no revival of U.S. Steel in the first place if our activities were restricted," Hashimoto said, a day after the deal was finalized following a year and a half of struggle that saw U.S. President Donald Trump and his predecessor Joe Biden block it. Under a national security agreement signed with the U.S. government, a U.S. president or a designated official will have the right to approve management decisions, including the closure or idling of U.S. Steel's existing manufacturing facilities. "It's quite an efficient deal given that we are buying a production capacity of 23 million tons for 2 trillion yen," he said, regarding the purchase price. "Profitability is ensured and (the deal) is satisfactory for both Nippon Steel and U.S. Steel." Nippon Steel remains the world's fourth-largest steelmaker through the acquisition of U.S. Steel, with their combined production volume in 2024 at 57.82 million tons, behind China Baowu Steel Group Corp., Arcelor Mittal SA and Ansteel Group Corp. But the output volume comes closer to 59.55 million tons at world No. 3 Ansteel. Nippon Steel's annual global capacity has increased to 86 million tons through the buyout, approaching its goal of 100 million tons, as it aims to make a foray into Southeast Asia, India and other overseas markets to make up for shrinking domestic demand. "What the U.S. government expects from us is to maintain and expand production capacity (at U.S. Steel) with the implementation of aggressive investment to increase the product lineup, and we intend to carry out the investment to create jobs and reduce the U.S. deficit," Hashimoto said. U.S. Steel is of growing strategic importance as higher U.S. tariffs on steel products, introduced by Trump, are likely to remain in place, Hashimoto said, adding the Japanese producer can benefit from growth in U.S. demand for high-grade steel, its specialty, used widely in electric vehicles. Hashimoto said while his company's acquisition of U.S. Steel should help the world's largest economy, trade levies will not revive its manufacturing sector. "I believe President Trump came to the conclusion that it is necessary to utilize our power to revive the U.S. steel industry," Hashimoto said. Under the national security agreement signed with the U.S. government, Nippon Steel also pledged to keep U.S. Steel's headquarters in Pittsburgh. Related coverage: Nippon Steel finalizes deal to make U.S. Steel wholly owned Trump effectively approves Nippon Steel's takeover of U.S. Steel Trump says U.S. Steel controlled by him with "golden share"
Yomiuri Shimbun
a day ago
- Business
- Yomiuri Shimbun
Nippon Steel Completes Acquisition of U.S. Steel; Nippon Steel Chairman Says Firm, U.S. Steel, Committed to Becoming ‘World's Leading Steelmaker'
The Yomiuri Shimbun Nippon Steel Chairman Eiji Hashimoto speaks at a press conference in Tokyo on Thursday. Nippon Steel Corp. has completed the acquisition process of United States Steel Corp., the Japanese company announced Wednesday. After completing the payment, Nippon Steel has acquired 100% of the ownership of U.S. Steel's common stock, and U.S. Steel became its subsidiary. Based on the merger agreement, the transaction came to about $14.1 billion (about ¥2 trillion), making it the largest investment Nippon Steel has ever made. U.S. Steel will be delisted from the New York Stock Exchange. According to the announcement, U.S. Steel will issue a 'golden share' to the U.S. government based on the National Security Agreement, which Nippon Steel concluded with U.S. President Donald Trump's administration on June 13 to reduce the threat to U.S. national security. With the golden share, the U.S. government will have the right to appoint one independent director and veto power over important management decisions, such as changing the location of U.S. Steel's headquarters and the reduction of its production capacity. Nippon Steel Vice Chairman Takahiro Mori will also hold the position of chairman of the board of U.S. Steel, allowing 'Nippon Steel to have flexibility of corporate management and profitability within U.S. Steel while ensuring U.S. national security,' according to Nippon Steel. The two companies' combined production was 57.82 million tons of crude steel last year, closing in on China's Ansteel Group, which is currently the third largest producer of steel worldwide. 'Nippon Steel is committed, together with U.S. Steel, to solidify its position as the world's leading steelmaker,' Nippon Steel Chairman Eiji Hashimoto said in a statement. Nippon Steel first announced its proposed acquisition of U.S. Steel in December 2023. However, the administration of then U.S. President Joe Biden issued an order to block the deal, citing U.S. national security concerns after a review by the U.S. Committee on Foreign Investment. The deal became a diplomatic issue between Japan and the United States and ended up taking a year and a half to finally complete the acquisition. 'In this agreement [on the acquisition of U.S. Steel], Nippon Steel's objective of expanding its business in the United States aligned with the U.S. government's desire to revive the U.S. manufacturing industry,' Hashimoto said at a press conference in Tokyo on Thursday. Hashimoto added that the acquisition secured management flexibility and profitability and it was a 'satisfactory' acquisition. Nippon Steel will invest about $11 billion (about ¥1.6 trillion) in U.S. Steel by 2028, aiming to restore old equipment and build a new steel plant. Hashimoto stressed that '[the investment] is necessary and will be effective in increasing the corporate value of U.S. Steel.' Regarding the golden share, Hashimoto said: 'We have closely examined [the contents of the veto rights], and there is no concern that the U.S. will block what we want to do. First of all, U.S. Steel will not be able to revive itself if our actions are restricted.' Hayashi: Deepening partnership 'It is a symbolic deal that can lead to improving the environment surrounding global investment,' Chief Cabinet Secretary Yoshimasa Hayashi said at a press conference on Thursday. 'It will strengthen the mutual economic relationship between Japan and the U.S., and the investment will also deepen the Japan-U.S. partnership,' Hayashi added.
a day ago
- Business
Nippon Steel Satisfied with U.S. Steel Buyout: CEO
News from Japan Economy Jun 19, 2025 16:17 (JST) Tokyo, June 19 (Jiji Press)--Nippon Steel Corp. is satisfied with its acquisition of United States Steel Corp., which has just been completed, Chairman and CEO Eiji Hashimoto said Thursday. "We're satisfied with the degree of freedom of management and profitability secured" under the final deal, Hashimoto told a press conference in Tokyo. U.S. Steel will start anew with the understanding and cooperation of U.S. President Donald Trump's administration, he said. "I want to express my respect for President Trump's historic and visionary decision." Nippon Steel bought U.S. Steel for 14.1 billion dollars, or 55 dollars per share, some 18 months after announcing the buyout plan. According to the two companies, U.S. Steel will issue the U.S. government a "golden share" granting the right to veto important business decisions at the company. [Copyright The Jiji Press, Ltd.] Jiji Press
Business Recorder
a day ago
- Business
- Business Recorder
Tariffs boost strategic importance of US Steel deal, Nippon Steel CEO says
TOKYO: The US administration's policy shift to introduce high tariffs will increase the strategic importance of Nippon Steel's business development in the US market, the top Japanese steelmaker's CEO, Eiji Hashimoto, said on Thursday. Hashimoto was speaking at a press conference in Tokyo a day after Nippon Steel closed its $14.9 billion acquisition of US Steel, confirming an unusual degree of power for President Donald Trump after the Japanese company's 18-month struggle to close the purchase. Nippon, US Steel complete partnership deal The companies also disclosed details of a national security agreement inked with the Trump administration, which gives the president the authority to name a board member as well as a non-economic golden share. The measures represent an unusual level of control conceded by the companies to the government to save the deal, after a rocky path to approval spurred by high-level political opposition.
