On Friday, President Donald Trump indicated that national security concerns over Nippon Steel’s $14.9 billion bid for U.S. Steel could be addressed through certain undisclosed conditions, potentially leading to the deal’s approval. Following the announcement, shares of U.S. Steel increased by 3.5% in after-hours trading, reflecting investor optimism regarding the impending agreement. Trump’s executive order highlighted that the national security risks posed by the transaction could be mitigated if specific conditions were met.
In response, both companies expressed gratitude to Trump, revealing plans for $11 billion in investments by 2028 and a governance commitment that includes a “golden share” to be issued to the U.S. government, although they did not clarify the extent of control this would grant. Earlier in the day, U.S. Steel’s shares had dipped after a Nippon Steel executive mentioned the need for “management freedom,” contradicting Trump’s assertion that the U.S. would maintain oversight.
Nippon Steel’s bid, announced in December 2023, has faced opposition from both Democratic and Republican leaders, including former President Joe Biden, who blocked the deal in January over national security concerns, prompting lawsuits from the companies. The Trump administration initiated a new 45-day national security review in April, creating opportunities for Nippon Steel. However, Trump’s comments have raised questions about the potential structure of the partnership, with mixed signals about ownership and investment levels.
To navigate ongoing legal challenges, Nippon Steel and Trump’s administration requested an extension on litigation pauses, which could be prolonged beyond a Friday expiration. The acquisition contract between Nippon Steel and U.S. Steel is set to expire on June 18, although the companies might negotiate a delay.
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