Nippon, US Steel finalize partnership, promise $11 billion in investments

US Steel, Japan's Nippon Steel, and the US government finalized a partnership with $11 billion in investments June 18, the companies said in a joint press release.

The agreement brings to a close Nippon's years-long efforts to acquire US Steel. The century-old US company has been on the block at least since 2023, when steelmaker Cleveland-Cliffs tried to acquire the company with the backing of the United Steelworkers, the major union on site. Nippon swept in with a larger bid, and the companies finally persuaded US President Donald Trump to approve the deal June 13.

US Steel also issued a "golden share" to the US government. The president must consent before Nippon can engage in a wide variety of business decisions, including moving the company, reducing US Steel's footprint, or moving jobs outside the US.

Nippon's original proposal was an over $14 billion deal to acquire the US-based manufacturer. The company was slated to pay $55/share in an all-cash transaction, representing a 40% premium to US Steel's stock.

"I would like to express my sincere gratitude to all of them for their tremendous cooperation and support for this partnership," Takahiro Mori, Nippon's vice chairman, said in a statement. "I am delighted that we have made this day a reality."

Under the deal, Mori will become the chairman of US Steel.

US Steel will retain its name and remain a US-incorporated entity with its headquarters remaining in Pittsburgh, Pennsylvania.

The partnership is expected to protect and create more than 100,000 jobs with investments made in Pennsylvania, Indiana, Arkansas, Minnesota and Alabama.

Trump flip-flopped on the acquisition after opposing the deal throughout his 2024 campaign for president. The new deal follows Trump's decision to double steel tariffs to 50%.

Nippon Steel said in 2023 that it would acquire US Steel for $14 billion, but former President Joe Biden blocked the proposal, citing national security concerns and the need to control American supply chains.

National security agreement

The US government, US Steel and Nippon agreed to protect national security measures as part of the partnership.

This includes ensuring a majority of US Steel's board of directors -- including its CEO -- are US citizens.

US Steel will maintain its capacity to produce and supply steel from its production locations to meet US market demand. Additionally, Nippon Steel will not prevent, prohibit or interfere with US Steel's ability to pursue trade action under US law.

Nippon Steel's $11 billion in new investments in US Steel will be made by 2028. This includes an initial investment in a greenfield project that will be completed after 2028.

US government's Golden share

US Steel also issued a "golden share" to the US government as part of the partnership.

Through the golden share, the US government has certain rights, including the ability to appoint an independent director.

It also gives consent rights to the US president, or his designee, on matters related to reducing committed capital investments under the NSA, transferring production or jobs outside of the US and acquiring competing businesses in the US.

The "golden share" gives the president the authority to change US Steel's name and headquarters as well as redomicile US Steel outside of the United States.

It also gives the president consent rights to make certain decisions on the closure or idling of US Steel's US manufacturing facilities, trade, labor and sourcing outside the US.

"This framework will enable Nippon Steel to secure management flexibility and profitability at US Steel while protecting US national security," the press release said.

Companies praise deal; workers unhappy

Nippon Steel Group's annual crude steel production capacity is expected to reach 86 million mt through the partnership.

"I am very pleased that the partnership between Nippon Steel and US Steel has been realized thanks to President Trump's historic and visionary decision," Eiji Hashimoto, Nippon's representative director, chair and CEO, said in a June 18 statement.

Takahiro Mori, Nippon's representative director and vice chair, will serve as the chair of the Board of US Steel.

"We share President Trump's commitment to protect the future of the American steel industry, American workers, and American national security, and we look forward to building a stronger and brighter future for US Steel," Mori said in a statement.

US Steel CEO Dave Burritt also praised Trump for his leadership in securing the deal.

"Through our partnership with Nippon Steel, we are poised to grow better and bigger, with transformative investment, cutting-edge technology, and the creation of good-paying jobs across the United States," Burritt said in a statement.

United Steelworkers, North America's largest private-sector union, sounded a skeptical note about the deal.

"[The deal] finally found acceptance by President Donald Trump, who now, through his 'golden share,' has assumed a startling degree of personal power over a corporation," USW CEO David McCall said in a statement. "As the sale concludes, it seems likely that attention will dissipate ...However, our union will remain. We will continue watching, holding Nippon to its commitments."