Trump Approves Nippon Steel-US Steel Deal with Security Agreement

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US President Donald Trump has given the green light to a major deal. This deal lets Nippon Steel, a Japanese company, invest in US Steel. But there’s a catch. The deal must follow a special “national security agreement” set by the government.

Key Points of the Deal

• $11 Billion Investment: Both companies will pour in $11 billion by 2028.
• Golden Share: The US government gets a “golden share”. This helps protect national security interests in steel production.
• Thanks to Trump’s Team: Both companies thanked Trump’s administration. They stressed how important this partnership is for American manufacturing.

Regulatory Approvals and Market Response

The deal is almost done. It just needs final approvals and a review by the Department of Justice. After the news, US Steel shares went up. They reached $54.85 in after-hours trading on Friday. This is close to Nippon Steel’s initial offer of $55 per share in late 2023.

End of a Long Wait

This deal ends a long period of uncertainty. People were worried about international control of a key state resource. The uncertainty started when US Steel and Nippon Steel announced their $14.9 billion merger plan in December 2023.

Details and Confidentiality

We don’t know much about the “golden share” or the security agreement. The investment details are also unclear. But White House spokesman Kush Desai said the order helps keep US Steel in Pennsylvania. Legal expert James Brower noted that such agreements are usually confidential, especially for the government.

Deal Value and Promises

The deal was first valued at nearly $15 billion. But it faced delays due to national security concerns during Biden’s presidency. Now, American officials value it at $28 billion. This includes the purchase bid and plans for a new electric arc furnace after 2028.

Nippon Steel’s Promises

• Keeping the headquarters in Pittsburgh
• Setting up a board with mostly Americans
• Protecting plant operations and trade interests
• Not importing steel slabs that would compete with US blast furnaces

Trump’s Position and Future Steps

Trump first opposed the purchase. But later, he was open to talks. He claimed “total control” through the golden share. However, Nippon Steel still plans to fully own US Steel.

The order recognizes possible national security risks. But it believes the security agreement can handle them. The Treasury Department and CFIUS agencies must approve the agreement before the deal closes. Trump still has the power to take more actions.