Trump Administration Claims ‘Golden Share’ Rights in US Steel-Nippon Tieup

When President Trump gave his seal of approval to Nippon Steel’s controversial merger with US Steel on Friday, the details were hardly iron-clad.

That changed Tuesday, when a leading politician in US Steel’s home state detailed how the federal government will maintain a say over key decision-making. 

Alloying Their Concerns

Nippon, Japan’s largest steelmaker with $58.7 billion in revenue for the fiscal year ended March 31, has been angling to acquire US Steel since December 2023. But its $14.9 billion bid drew the ire of Trump and former President Joe Biden, with both suggesting America’s second-largest steelmaker should be off-limits to foreign owners.

The company’s headquarters being in Pennsylvania, a key swing state in the November presidential election, added an ultra-sensitive political dimension to an already controversial proposal, which the United Steelworkers union vocally opposed over fears Nippon might cut jobs. Biden blocked the deal in January on national security grounds, and last month, Trump’s administration launched a new review of the deal by the Committee on Foreign Investment in the United States (CFIUS). Then, late last week, Trump seemingly backed the acquisition, calling it a “partnership” that would keep the company’s headquarters in Pittsburgh and create “at least 70,000 jobs.” On Tuesday, Republican Pennsylvania Senator David McCormick revealed that strings would be attached to the deal to allay national security and other concerns:

• McCormick said the US would receive a so-called “golden share” in US Steel, which would grant the federal government a de facto veto over key decisions. In an interview with CNBC, he noted the golden share will “essentially require US government approval of a number of the board members, and that will allow the United States to ensure production levels aren’t cut and things like that.” 
• McCormick added that US Steel would still be led by an American CEO and that US nationals would make up the majority of the board. The terms would be laid out in a CFIUS agreement that Nippon would ink with the federal government, he said, noting the prospective Japanese parent proposed the idea because it “wanted an opportunity to get access to the US market.” (The merger would create the second-largest steelmaker in the world.)

Promises Made: US steelmakers have been undercut by the rise of low-cost producers abroad and hurt by failures to adopt new technologies at home, but Nippon has promised to reverse that with $14 billion in investments. According to McCormick, that will include $2.4 billion toward the company’s plant in suburban Mon Valley. The final details will have to wait until a “BIG rally” that Trump promised this Friday in Pittsburgh.