Key points
- New “planned partnership” will create at least 70,000 jobs: Trump
- Partnership will add $14 billion to the US economy
- US Steel and Nippon Steel announced plans for a $14.9 billion merger in December 2023
WASHINGTON, United States: US President Donald Trump on Friday threw his support behind a new “partnership” between US Steel and Japan’s Nippon Steel, sending the American firm’s share price skyrocketing on hopes of an end to the long-running saga over foreign ownership of a key national asset.
According to AFP, while the details of the deal remained unclear, the Pennsylvania-headquartered firm’s share price popped after Trump took to Truth Social to hail the new arrangement, closing up more than 21 per cent and then rising further in after-hours trading.
New “planned partnership”
“US Steel will REMAIN in America, and keep its Headquarters in the Great City of Pittsburgh,” the US president said in his social media post.
He added that the new “planned partnership” between America’s US Steel and Japan’s Nippon Steel would create at least 70,000 jobs and add $14 billion to the US economy.
Merger plans
Trump’s remarks are the latest in a long saga which began in December 2023, when US Steel and Nippon Steel announced plans for a $14.9 billion merger.
That deal was bitterly opposed by unions in part because it would have transferred ownership of the critical asset to a foreign company.
According to CNBC, US Steel’s headquarters will remain in Pittsburgh and the bulk of the investment will take place over the next 14 months, the president said. US Steel shares surged more than 20 per cent to close at $52.01 per share after Trump’s announcement.
According to AFP, in a statement, Nippon Steel said it “applauds” the bold action taken by Trump, adding it shared the administration’s “commitment to protecting American workers, the American steel industry, and America’s national security.”
US Steel praised Trump’s “bold” leadership on the deal, noting that it would “remain American” and expand in size due to the “massive investment” that Nippon would make over the next four years as part of the deal.
Neither the White House nor the two companies, have so far published the details of the new partnership.
Opposition to the deal
The United Steelworkers’ union (USW), which represents US Steel employees and has long opposed the deal, said on Friday that it could not “speculate” on the impact of Trump’s announcement without more information about the deal.
“Our concern remains that Nippon, a foreign corporation with a long and proven track record of violating our trade laws, will further erode domestic steelmaking capacity and jeopardize thousands of good, union jobs,” USW International President David McCall said in a statement shared with AFP.
Nippon’s acquisition of US Steel was originally meant to close by the end of 2024’s third financial quarter, but was then held up by former president Joe Biden, who blocked it in his last weeks in office on national security grounds.
“Illegal interference”
The two firms then filed a lawsuit against the Biden administration’s “illegal interference” in the transaction.
Trump previously opposed Nippon Steel’s takeover plan, calling for US Steel to remain domestically owned. But he has since softened his tone and has suggested he is open to some form of investment from Nippon.
The US president recently ordered his own review of the existing deal, directing the government’s Committee on Foreign Investment in the United States (CFIUS) to look into the proposed acquisition.
CFIUS, tasked with analysing the national security implications of foreign takeovers of US companies, was given 45 days to submit its recommendations to Trump.
