US Steel: Trump approves takeover by Japanese company Nippon Steel

US PresidentDonald Trump (78) has approved the takeover of US Steel by Japanese competitor Nippon Steel for $14.9 billion. This ends an 18-month takeover battle that was under fire from political and labor groups in the US . Trump signed an executive order on Friday allowing the merger on the condition that the companies sign an agreement with the Treasury Department to address national security concerns. The companies subsequently announced that they had signed this agreement. The takeover will provide US Steel with urgently needed investment, and Nippon Steel will be able to benefit from US infrastructure projects while circumventing steel tariffs imposed by Trump.

"We look forward to implementing our commitments to make American steel production and manufacturing great again," the companies said in their statement, thanking Trump. The agreement includes investments of $11 billion through 2028, as well as commitments on corporate governance, production, and trade. Nippon Steel will acquire 100 percent of US Steel, a spokesperson for the Japanese company announced in Tokyo on Saturday. According to data from the World Steel Association, the merger would create the world's third-largest steel company by production, after China's Baowu Steel Group and ArcelorMittal.

The two steelmakers did not provide any further details about the promised "golden share" for the US government, raising questions about the extent of US control. US Senator David McCormick (59) from the state of Pennsylvania, where US Steel is headquartered, stated last month that the golden share would give the government veto power over important decisions affecting the long-established US company.

The acquisition secures urgently needed investment for the struggling US company. According to information from the Reuters news agency, Nippon Steel plans to invest an additional three billion dollars in a new plant after 2028. The acquisition allows Nippon Steel to benefit from numerous US infrastructure projects, while foreign competitors face steel tariffs of 50 percent. Currently the world's fourth-largest steel producer, it also avoids contractual penalties of $565 million that would have been due if the permit had not been granted. For Nippon Steel, access to the US market is a key element of its global growth strategy.

The Japanese government welcomed the agreement between Nippon Steel and US Steel. This investment will enhance the innovative capacity of the steel industries in the US and Japan and further strengthen the close partnership between the two countries, said Minister of Economic Affairs Yoji Muto (69).

Nippon Steel's takeover bid has met with resistance in the US since its announcement in December 2023. After the United Steelworkers union opposed the deal last year, both then-President Joe Biden (82) and Trump voiced their opposition while campaigning for votes in the contested state of Pennsylvania. Shortly before leaving office in January, Biden blocked the deal on national security grounds. His successor, Trump, then ordered a new review in April, rekindling the companies' hopes of a successful takeover.