U.S. Steel (X) Set to Be Acquired by Nippon Steel at $55 a Share Following Trump Approval
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Japan's Nippon Steel is expected to close its acquisition of U.S. Steel (X, Financials) at $55 per share, according to CNBC on Tuesday, following approval from President Donald Trump. The deal, originally blocked in January under the Biden administration, will now move forward under a revised agreement that ensures U.S. operational control.
Trump referred to the transaction as a partnership and said Nippon will invest $14 billion in the U.S. over the next 14 months. As part of the agreement, U.S. Steel will retain its headquarters in Pittsburgh, and an American CEO and majority U.S.-based board members will lead the company. Senator Dave McCormick said a golden share held by the U.S. government will give it approval rights over board appointments and oversight on production levels.
Shares of U.S. Steel closed at $53.04 Tuesday, up 2%, after surging more than 20% on Friday following Trump's announcement. Nippon's original $55 bid matches the offer price that was previously declined on national security grounds.
Despite the political shift, the United Steelworkers union remains cautious, citing Nippon's record of trade violations and raising concerns over potential risks to domestic steel jobs. USW President David McCall said more clarity is needed on the deal's impact.
McCormick added that the $14 billion investment includes $2.4 billion earmarked for the Mon Valley facility near Pittsburgh, with the overall package expected to protect 10,000 jobs and create 10,000 more in construction trades through the addition of a new arc furnace.
The deal allows Nippon access to the U.S. market while preserving American oversight, McCormick said. Trump plans to hold a rally at U.S. Steel's Pittsburgh site on May 30.
This article first appeared on GuruFocus.