The Trump administration has outlined significant control over U.S. Steel’s operations through a newly established arrangement with Japan’s Nippon Steel, described as an ‘investment’ meant to secure American steel interests.
Following a national security agreement, which has garnered the White House’s approval, both U.S. Steel and Nippon Steel are set to embark on an ambitious plan, pledging to inject $11 billion into the Pittsburgh-based steelmaker by the year 2028.
Despite these announcements, Nippon Steel maintains its ambition to acquire U.S. Steel as a wholly-owned subsidiary in a nearly $15 billion deal initially proposed in late 2023.
The White House framed this deal as a ‘partnership’ while officials recently revealed the specifics of the so-called ‘golden share’ arrangement, which grants President Donald Trump extensive influence over U.S. Steel’s operations.
Commerce Secretary Howard Lutnick took to social media to explain how the golden share would work, emphasizing the administration’s willingness to interfere in the affairs of a private company, despite a simultaneous push for deregulation.
Under the terms of this agreement, Trump’s consent would be required for critical decisions such as relocating U.S. Steel’s headquarters from Pittsburgh, changing the company’s name, transferring production jobs outside the U.S., shutting down factories, or reincorporating the business abroad.
Additionally, Lutnick stated that any plans to reduce or postpone the $14 billion in future investments would also need presidential approval.
Interestingly, this $14 billion investment figure is higher than the amount mentioned by the companies, suggesting that the investment from Nippon Steel might involve the construction of a new electric arc furnace in the U.S., thus raising the total investment value to at least $28 billion.
Under the new governance structure, the president holds the authority to appoint one director among the corporate board’s three independent members while also exercising veto power over the selection of the remaining two.
These governance details were revealed as President Trump was en route to the G7 summit in Alberta, Canada.
However, the complete terms of Nippon Steel’s acquisition, as well as the stipulations outlined in the national security agreement, remain somewhat ambiguous, with neither the companies nor the government disclosing all details publicly.
In response to the unfolding situation, the United Steelworkers union, which represents U.S. Steel employees, expressed profound disappointment regarding the Trump administration’s shift from its previous stance of opposing Nippon Steel’s acquisition.
In an open letter, the union raised fundamental questions about the ownership structure of U.S. Steel and emphasized the lack of transparency regarding the terms of this proposed transaction.
The union pointed out that their current labor agreement is set to expire on September 1, 2026, and signaled its readiness to engage with the new owners to negotiate a fair contract for workers.
Should President Trump indeed wield the level of control he asserts over U.S. Steel, he will find himself in a complicated position when it comes to negotiating the benefits and salaries of unionized steelworkers amid the upcoming midterm elections.
In January, outgoing President Joe Biden exercised his authority to prevent Nippon Steel’s acquisition of U.S. Steel, following a review by the Committee on Foreign Investment in the United States (CFIUS).
After winning the election, Trump expressed a willingness to revisit the issue, which led to a new review by CFIUS and the eventual creation of the golden share concept, designed to assuage national security concerns while safeguarding American interests in domestic steel production.
To garner favor with U.S. officials, Nippon Steel made several commitments, including an increase in its investment in U.S. Steel, a guarantee to maintain the company’s headquarters in Pittsburgh, the appointment of a board with a majority of American citizens, and a commitment to keep production plants operational.
Moreover, Nippon Steel has pledged to advocate for U.S. Steel in trade matters and promises to refrain from importing steel slabs that could compete with U.S. Steel’s production facilities in Pennsylvania and Indiana.
image source from：https://www.witf.org/2025/06/16/trump-administration-offers-some-details-of-how-it-would-control-us-steel-but-union-raises-concerns/
