HARRISBURG, Pa. (AP) 鈥� Nippon Steel and U.S. Steel said Wednesday they have finalized their 鈥渉istoric partnership,鈥� a deal that gives the U.S. government a say in some matters and comes a year-and-a-half after the Japanese company first proposed its nearly $15 billion buyout of the iconic American steelmaker.
The pursuit by for the Pittsburgh-based company was buffeted by national security concerns and in a premier battleground state, dragging out the transaction for more than a year after U.S. Steel shareholders approved it.
It also forced Nippon Steel to expand the deal, including adding a that gives the federal government a say in company decisions that affect domestic steel production and the power to appoint a board member.
鈥淭ogether, Nippon Steel and U.S. Steel will be a world-leading steelmaker, with best-in-class technologies and manufacturing capabilities,鈥� the companies said.
The combined company will become the world's fourth-largest steelmaker, and bring what analysts say is Nippon Steel's top-notch technology to U.S. Steel's antiquated steelmaking processes, plus a commitment to invest $11 billion to upgrade U.S. Steel facilities.
In exchange, Nippon Steel gets access to a robust U.S. steel market, strengthened in recent years by tariffs under President Donald Trump and former President Joe Biden, analysts say.
In a note, Mergermarket analyst Reuben Miller said Trump was right to approve Nippon Steel鈥檚 acquisition of U.S. Steel.
Still, Miller said, the golden share arrangement 鈥渕ay have negative consequences for inbound investment into the U.S. in the long term, as it introduces a risk that companies will have to take the U.S. Government on as a partner.鈥�
Nippon Steel and U.S. Steel did not release a copy of the with Trump's administration.
But in a statement Wednesday, the companies said the federal government will have the right to appoint an independent director and get 鈥渃onsent rights鈥� on specific matters.
Those include reductions in Nippon Steel's capital commitments in the national security agreement; changing U. S. Steel鈥檚 name and headquarters; closing or idling of U.S. Steel鈥檚 plants; transferring production or jobs outside of the U.S.; buying competing businesses in the U.S.; and certain decisions on trade, labor and sourcing outside the U.S.
announced in December 2023 that it planned to buy the steel producer for $14.9 billion in cash and debt, and committed to keep the U.S. Steel name and Pittsburgh headquarters.
The United Steelworkers union, which represents some U.S. Steel employees, opposed the deal, and Biden and Trump both vowed from the campaign trail to block it.
Biden used his authority to of U.S. Steel on his way out of the White House after a review by the Committee on Foreign Investment in the United States.
After he was elected, Trump changed course, to working out an arrangement and ordering another review by the committee.
That鈥檚 when the idea of the 鈥済olden share鈥� emerged as a way to resolve national security concerns and protect American interests in domestic steel production.
As it sought to win over American officials, Nippon Steel . Those included putting U.S. Steel under a board made up of a majority of American citizens, with a management team made up of American citizens.
It pledged not to conduct layoffs or plant closings as a result of the transaction, to protect the interests of U.S. Steel in trade matters and that it wouldn鈥檛 import steel slabs that would compete with U.S. Steel鈥檚 blast furnaces in Braddock, Pennsylvania and Gary, Indiana.
In the final agreement, it also pledged to produce and supply U.S. Steel from its domestic production locations 鈥� such as mining operations in Minnesota 鈥� and to allow U. S. Steel to pursue trade actions under U.S. law.
It also made a series of bigger capital commitments in U.S. Steel facilities, tallying $11 billion through 2028, it said.
Nippon Steel said its annual crude steel production capacity is expected to reach 86 million tons, closer to its goal of 100 million tons.
The United Steelworkers on Wednesday noted that its current labor agreement with U.S. Steel expires in 2026.
"Rest assured, if our job security, pensions, retiree health care or other hard-earned benefits are threatened, we are ready to respond with the full strength and solidarity of our membership," its international president, David McCall, said in a statement.
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Marc Levy, The Associated Press
