U.S. Government Maintains Control Over U.S. Steel Acquisition by Nippon Steel

U.S. President Donald Trump and Senator David McCormick have stated that the U.S. government will maintain control over the proposed acquisition of U.S. Steel by Nippon Steel. This announcement comes as part of a broader effort to address national security concerns surrounding the deal, which involves Nippon Steel investing 14 billion in U.S. Steel. The U.S. government has assured that while Nippon Steel will gain partial ownership, the company will remain under U.S. control, with a U.S. CEO and a majority of the board members being U.S. citizens. Additionally, certain company functions will require approval from the U.S. government.

Trump and McCormick's statements follow a pattern of assurances made by Nippon Steel, which has previously committed to keeping U.S. Steel's headquarters in the U.S., appointing a majority of U.S. citizens to its board, and ensuring that the company's management team is composed of U.S. citizens. Nippon Steel has also pledged not to lay off workers or close factories as a result of the deal, and to protect U.S. Steel's interests in trade matters. To facilitate the transaction, Nippon Steel has proposed investing 2.7 billion to improve two of U.S. Steel's blast furnaces and has committed to not importing steel slabs that would compete with these facilities.

Nippon Steel's proposed acquisition of U.S. Steel has faced opposition from the United Steelworkers union and was blocked by Joe Biden before he left office. However, Trump has since ordered the Committee on Foreign Investment in the U.S. to re-examine the deal for national security concerns. The U.S. Steel board and shareholders have approved the acquisition, but the deal has yet to be finalized. McCormick has stated that Nippon Steel has agreed to invest 14 billion in U.S. Steel and to sign a national security agreement with the U.S. government. The deal includes the construction of a new electric arc furnace and a 2.4 billion investment in U.S. Steel facilities in the Pittsburgh area, including the Edgar Thomson Works blast furnace, which was built in the 19th century.

McCormick has also noted that Nippon Steel will appoint board members and that the entity will be "integrated into its overall corporate structure." He added that Nippon Steel will gain access to the U.S. market and the benefits of long-standing U.S. protectionist tariffs, which analysts have said have helped revive the domestic steel industry. "I think they know what they're doing," McCormick said. "They were part of the negotiations, this was their proposal, and I think they see it as a major strategic move that is beneficial to them and to the U.S."