Nippon Steel completes $14.9B US Steel takeover

Japanese steel giant Nippon Steel has finalized its $14.9?billion acquisition of US Steel, ending an 18-month political and regulatory battle.

The $55-a-share transaction makes Nippon the world’s second-largest steelmaker by output.

The deal had faced strong resistance from US labour unions and political leaders, including former President Joe Biden. It was revived under Donald Trump’s administration, which initiated a new national security review.

That review resulted in the creation of a “golden share,” giving the US government sweeping veto power over key decisions such as plant closures, production cuts, and job relocations. The arrangement was first revealed in a weekend social media post by Commerce Secretary Howard Lutnick.

US Steel will retain its iconic name and headquarters in Pittsburgh, Pennsylvania.

A majority of the members of US Steel’s board of directors will be US citizens, and key management personnel, including its CEO, will also be US citizens.

Nippon Steel’s chairman, Eiji Hashimoto, credited Trump for helping bring the deal to completion and said the merger marks a new era for the historic American steelmaker.

Nippon Steel will make approximately $11 billion in new investments in US Steel by
2028, which includes an initial investment in a greenfield project that will be completed after 2028.

The acquisition expands Nippon Steel’s crude steel output capacity to 86 million tonnes annually, nearing its strategic 100-million-tonne target.

US Steel shares stopped trading at 8:30 a.m. ET on Wednesday after the acquisition.

Timeline

First proposed in December 2023, the deal was derailed when the Biden administration blocked it on national security grounds.

Legal action followed, but under the Trump administration, a new 45-day review was initiated by the Committee on Foreign Investment in the US. Nippon also hired former US Secretary of State Mike Pompeo and engaged labor leaders to help steer the deal to completion amid strong political headwinds.

The resulting agreement included unprecedented terms: a US-appointed board member, capital spending guarantees, and citizenship rules for executives.

While the golden share was key to regulatory approval, it raises concerns about future foreign interest in strategic US assets.