On June 13, U.S. President Donald Trump issued an executive order enabling Japanese company Nippon Steel to acquire U.S. Steel after 18 months of uncertainty. In doing so, he reversed a prior January 3 decision by former President Joe Biden to block the deal on national security grounds. Although Trump agreed with Biden on the existence of potential security risks, the new executive order proposes that these risks could be mitigated through a national security agreement (NSA) between the two companies and the U.S. government. On June 14, Nippon Steel and U.S. Steel reached this agreement, which includes $11 billion in new investments to be made by 2028, taking into account an initial investment in a greenfield project that will be completed after 2028. The NSA also contains commitments related to governance, including giving the U.S. government a “golden share” that would grant veto power over important management decisions and ensuring that key corporate leadership roles go to U.S. citizens. Nippon Steel and U.S. Steel are expected to finalize their partnership by June 18.
Understanding Trump’s Decision to Approve the Nippon Steel Deal
