Latest news with #U.S.Steel
Kyodo News
4 hours ago
- Business
- Kyodo News
FOCUS: Nippon Steel buyout spat hints at business fragility in U.S.
By Junko Horiuchi, KYODO NEWS - 7 hours ago - 13:07 | Japan, All U.S. President Donald Trump's bid to attract investment threatens to undermine the appetite for corporate spending in an ironic twist, with the 18-month saga over Nippon Steel Corp.'s buyout of United States Steel Corp. showing the growing vulnerability of businesses in the U.S. market, according to analysts. The U.S. administration's earlier blocking of the $14.1 billion takeover deal was clearly driven by political motives and corporate executives will no longer be able to make decisions regarding their U.S. operations based only business criteria, they said. The wrangling in the high-profile case could lead global companies to think twice about making sizeable investments and acquisitions in the world's largest economy, with many moving to reduce their exposure to the U.S. market. "I do think many companies are pausing investments and major capital expenditures, not only because of the Nippon-U.S. Steel deal but due to general uncertainty surrounding political and economic dynamics in Washington," said Zack Cooper, senior fellow at the American Enterprise Institute. Trump had repeatedly rejected Nippon Steel's plan to take full control of U.S. Steel. But Nippon Steel, the world's fourth-largest steel producer, and U.S. Steel, the 29th largest, said Wednesday following Trump's approval of the buyout plan that they had signed a national security agreement with the U.S. government and finalized the acquisition transaction. Under the deal, the Japanese steelmaker is obliged to invest $11 billion by 2028 on bolstering the U.S. steelmaker's operations, far more than the previously planned $2.7 billion. The U.S. government also obtained a golden share allowing it to veto key management decisions, such as when reducing investment, shedding production capacity in the United States or closing plants. Nippon Steel CEO Eiji Hashimoto told a press conference on Thursday that his company had learned from a year and a half of negotiations with the U.S. government that a flexible management strategy is required. The top executive said it had been believed that governments should not get involved in business deals. "But are strengthening their involvement in economic and business matters through industrial policy," he said. Trump's predecessor, Joe Biden, initially blocked the purchase of U.S. Steel on national security grounds, saying the manufacturing icon, based in Pittsburgh, Pennsylvania -- a key battleground state in the 2024 presidential election -- should be "American-owned and American-operated." Trump also opposed the deal during the presidential race, saying the acquisition of a minority stake in U.S. Steel would not cause any issues, but foreign ownership of the company would not be good psychologically. He ordered a new review of the deal by the Committee on Foreign Investment in the United States in April with a deadline for Trump to make a final decision initially set for June 5. "Because predictability is insanely low right now in the United States, Japanese companies are going to cut back the percentage of their business in the country," said Keisuke Hanyuda, the chief executive of Owls Consulting Group. While rising costs must be dealt with, "The last thing a business wants is to lose predictability," said Hanyuda, a former Japanese trade ministry official in charge of trade talks. Nippon Steel is betting on firm demand for high-tensile strength steel in the U.S. market, capitalizing on its advanced production technology for high-end steel plates used in products such as electric vehicles. The United States is one of three growth markets for the Japanese steelmaker, compensating for shrinking domestic demand. Under Trump, the steel, aluminum, auto and semiconductor sectors have been targeted by specific tariffs driven by political pressures and companies in these industries should consider other markets for growth to hedge their risks, analysts say. Earlier this month, Trump signed an order doubling the tariffs on steel and aluminum imports to 50 percent. "I think Japanese companies will have a difficult time purchasing famous American companies in sectors that President Trump prioritizes, such as autos, steel, aluminum, and chipmaking," Cooper at the American Enterprise Institute said, though investment in other sectors may still be viable. "But any Japanese company that is considering a major deal in the United States should develop a detailed political strategy before announcing a deal, lest they suffer similar roadblocks as Nippon Steel," he said. The United States remains a lucrative market with high growth potential but some global companies are beginning to reduce their reliance on it after the tariffs imposed by Trump, Hanyuda said. The European Union and the Association of Southeast Asian Nations, for example, have resumed economic partnership negotiations, while the EU is also looking at Japan, which is part of a trans-Pacific free trade pact that took effect in 2018 without the United States. Related coverage: U.S. Steel's strategic importance growing: Nippon Steel CEO Nippon Steel finalizes deal to make U.S. Steel wholly owned Trump effectively approves Nippon Steel's takeover of U.S. Steel
Kyodo News
12 hours ago
- Business
- Kyodo News
FOCUS: Nippon Steel buyout spat hints at business fragility in U.S.
By Junko Horiuchi, KYODO NEWS - 7 minutes ago - 13:07 | Japan, All U.S. President Donald Trump's bid to attract investment threatens to undermine the appetite for corporate spending in an ironic twist, with the 18-month saga over Nippon Steel Corp.'s buyout of United States Steel Corp. showing the growing vulnerability of businesses in the U.S. market, according to analysts. The U.S. administration's earlier blocking of the $14.1 billion takeover deal was clearly driven by political motives and corporate executives will no longer be able to make decisions regarding their U.S. operations based only business criteria, they said. The wrangling in the high-profile case could lead global companies to think twice about making sizeable investments and acquisitions in the world's largest economy, with many moving to reduce their exposure to the U.S. market. "I do think many companies are pausing investments and major capital expenditures, not only because of the Nippon-U.S. Steel deal but due to general uncertainty surrounding political and economic dynamics in Washington," said Zack Cooper, senior fellow at the American Enterprise Institute. Trump had repeatedly rejected Nippon Steel's plan to take full control of U.S. Steel. But Nippon Steel, the world's fourth-largest steel producer, and U.S. Steel, the 29th largest, said Wednesday following Trump's approval of the buyout plan that they had signed a national security agreement with the U.S. government and finalized the acquisition transaction. Under the deal, the Japanese steelmaker is obliged to invest $11 billion by 2028 on bolstering the U.S. steelmaker's operations, far more than the previously planned $2.7 billion. The U.S. government also obtained a golden share allowing it to veto key management decisions, such as when reducing investment, shedding production capacity in the United States or closing plants. Nippon Steel CEO Eiji Hashimoto told a press conference on Thursday that his company had learned from a year and a half of negotiations with the U.S. government that a flexible management strategy is required. The top executive said it had been believed that governments should not get involved in business deals. "But are strengthening their involvement in economic and business matters through industrial policy," he said. Trump's predecessor, Joe Biden, initially blocked the purchase of U.S. Steel on national security grounds, saying the manufacturing icon, based in Pittsburgh, Pennsylvania -- a key battleground state in the 2024 presidential election -- should be "American-owned and American-operated." Trump also opposed the deal during the presidential race, saying the acquisition of a minority stake in U.S. Steel would not cause any issues, but foreign ownership of the company would not be good psychologically. He ordered a new review of the deal by the Committee on Foreign Investment in the United States in April with a deadline for Trump to make a final decision initially set for June 5. "Because predictability is insanely low right now in the United States, Japanese companies are going to cut back the percentage of their business in the country," said Keisuke Hanyuda, the chief executive of Owls Consulting Group. While rising costs must be dealt with, "The last thing a business wants is to lose predictability," said Hanyuda, a former Japanese trade ministry official in charge of trade talks. Nippon Steel is betting on firm demand for high-tensile strength steel in the U.S. market, capitalizing on its advanced production technology for high-end steel plates used in products such as electric vehicles. The United States is one of three growth markets for the Japanese steelmaker, compensating for shrinking domestic demand. Under Trump, the steel, aluminum, auto and semiconductor sectors have been targeted by specific tariffs driven by political pressures and companies in these industries should consider other markets for growth to hedge their risks, analysts say. Earlier this month, Trump signed an order doubling the tariffs on steel and aluminum imports to 50 percent. "I think Japanese companies will have a difficult time purchasing famous American companies in sectors that President Trump prioritizes, such as autos, steel, aluminum, and chipmaking," Cooper at the American Enterprise Institute said, though investment in other sectors may still be viable. "But any Japanese company that is considering a major deal in the United States should develop a detailed political strategy before announcing a deal, lest they suffer similar roadblocks as Nippon Steel," he said. The United States remains a lucrative market with high growth potential but some global companies are beginning to reduce their reliance on it after the tariffs imposed by Trump, Hanyuda said. The European Union and the Association of Southeast Asian Nations, for example, have resumed economic partnership negotiations, while the EU is also looking at Japan, which is part of a trans-Pacific free trade pact that took effect in 2018 without the United States. Related coverage: U.S. Steel's strategic importance growing: Nippon Steel CEO Nippon Steel finalizes deal to make U.S. Steel wholly owned Trump effectively approves Nippon Steel's takeover of U.S. Steel
Business Insider
13 hours ago
- Business
- Business Insider
X, CLF, NUE: Canada to Raise Steel and Aluminum Counter-Tariffs
Canada is threatening to raise its counter-tariffs on imports of U.S. steel and aluminum products starting on July 21. Confident Investing Starts Here: Canadian Prime Minister Mark Carney said his government will place tariffs on steel and aluminum products that are 'consistent' with U.S. duties that currently sit at 50%. The move will coincide with the end of the 30-day trade deal deadline announced after Carney and U.S. President Donald Trump met at a recent G7 meeting. Prime Minister Carney also said that his government's procurement policies will favor Canadian suppliers and 'reliable trading partners' moving forward. Finally, his government will unleash new, retroactive tariff quota rates at 100% of 2024 levels on imports of steel products from non-free trade agreement countries. Higher tariffs from Canada are likely to impact major steel producers such as U.S. Steel (X), Cleveland-Cliffs (CLF), and Nucor Corp. (NUE). Tit-for-Tat The announcement of more tit-for-tat tariffs comes as Canada's industrial sector strains under pressure from President Trump's tariffs on steel and aluminum imports. Earlier in June, the president hiked existing metals tariffs from 25% to 50% in a move aimed at protecting American workers. Since the first Trump tariffs were introduced in April, layoffs have risen and investments fallen in Canada's metals sector, says the Canadian Steel Producers Association, which has previously said that, 'At a 50 per cent tariff rate, the U.S. market is effectively closed to Canadian steel.' Now, Prime Minister Carney says that new counter tariffs unveiled in coming weeks will combat symptoms of 'persistent global overcapacity.' Is CLF Stock a Buy? average CLF price target of $8.34 implies 13.78% upside from current levels.
The Hill
21 hours ago
- Business
- The Hill
US Steel, Nippon Steel finalize ‘historic partnership'
US Steel said Wednesday it finalized its merger with Japan's largest steelmaker, Nippon. President Trump lauded the acquisition as a partnership in which the U.S. would maintain a 'golden share' of profits with expanded investments in Pennsylvania, Indiana, Arkansas, Minnesota and Alabama. 'U. S. Steel will remain rooted in the United States and continue to call Pittsburgh home. Through our partnership with Nippon Steel, we are poised to grow better and bigger, with transformative investment, cutting-edge technology, and the creation of good-paying jobs across the United States,' U. S. Steel's CEO Dave Burritt said in a statement. Trump and former President Biden both spoke out against the merger on the 2024 campaign trail citing concerns for national security and global competition. Months after returning to the Oval, Trump approved the acquisition, ensuring it would spur job growth and boost U.S. manufacturing. The $15 million buyout was solidified under a National Security Agreement drafted by Trump. The provisions ensure that a sitting president or his designee will have consent rights over the transfer of production or jobs outside of the U.S., changing the company's name or headquarters and material acquisitions of competing businesses in the country. While the White House has lauded the deal, labor unions have shown fear that attention to work conditions and the broader objective of company operations will die down following the announcement of the merger. 'As the sale concludes, it seems likely that attention will dissipate. U.S. Steel's PR machine will power down, and the majority of elected officials will turn their attention elsewhere. However, our union will remain. We will continue watching, holding Nippon to its commitments,' United Steelworkers International President David McCall said in a statement. 'And we will use the most powerful tool workers have against global corporations: collective bargaining. Our current agreement expires in September 2026, and rest assured, if our job security, pensions, retiree health care or other hard-earned benefits are threatened, we are ready to respond with the full strength and solidarity of our membership.'
CBS News
a day ago
- General
- CBS News
U.S. Steel eaglet Ocho accidentally fledges the nest
Ocho, the U.S. Steel eaglet, has fledged the nest. Well ... kind of. Ocho left the nest at U.S. Steel's Irvin Plant in West Mifflin on Tuesday night, but instead of gracefully soaring to the skies, the young eagle tumbled off a branch and fell into the tree below. In a video from PixCams, which runs the livestream of the nest, Ocho is seen standing on a branch before the eaglet raises its wings, steps forward and falls, taking part of the nest down with it. PixCams has been able to spot Ocho, writing on Facebook, "Ocho looks to be in fine condition so no need to worry!" Before the accidental fledge, Ocho has been spending time branching, preparing for flight. PixCams has since posted several videos of Ocho perched on a branch below the nest. It's not clear what's next in Ocho's out-of-nest adventure, but viewers can watch online to find out. (Photo: PixCams/YouTube) The Audubon Society of Western Pennsylvania says eagles in the area usually leave the nest mid-summer and keep returning until their parents kick them out. While it's the sixth season for dad Irvin at the nest, mom Stella replaced Claire, who left the nest late last year. Irvin and Stella laid three eggs, but only Ocho hatched in March. The appropriately-named Ocho is the eighth eaglet to hatch at the U.S. Steel nest. The nest was built along the Monongahela River in 2019, and a wildlife camera has been livestreaming the family since 2021. Pittsburgh's eagle nesting season has been full of ups and downs this year. Usually bird watchers also have their eyes on the Hays eagle nest, but it collapsed during a storm last summer and the birds didn't rebuild in the same spot. However, trail photographers later found the eagles upstream across the river, and not only had they built another nest, but they had also hatched two eaglets. The hope is that PixCams can get another camera up there so Pittsburghers can keep up with the newly-renamed Glen Hazel eagles next year.
