'Golden share' to help U.S. Steel keep name and prevent relocation
The so-called golden share to be held by the U.S. government in United States Steel will prevent the company from relocating its headquarters from Pittsburgh or changing its name without the consent of the U.S. president, Commerce Secretary Howard Lutnick said Saturday.
Tokyo-based Nippon Steel plans to acquire all common shares in U.S. Steel while issuing a golden share in the U.S. company to the American government.
Lutnick said that the golden share will also prevent Nippon Steel from reducing, waiving or delaying its $14 billion investment into U.S. Steel, transferring production or jobs outside the United States and closing or idling plants before certain time frames without the consent of the U.S. president, Lutnick said.
The golden share "has powerful terms that directly benefit and protect America, Pennsylvania, the great steelworkers of U.S. Steel, and U.S. manufacturers that will have massively expanded access to domestically produced steel," Lutnick said in a post on X.
U.S. President Donald Trump signed an executive order on Friday that says Nippon Steel's acquisition of U.S. Steel will be approved on the condition that risks to national security are mitigated.
Based on the order, the two steelmakers concluded a national security agreement with the U.S. government that calls for it to receive a golden share.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yomiuri Shimbun
an hour ago
- Yomiuri Shimbun
‘Golden Share' Served as Solution in Trump's Approval of U.S. Steel Acquisition; Solution Found but Challenges Remain
The Yomiuri Shimbun U.S. President Donald Trump speaks at a U.S. Steel Corp. steel plant in Pennsylvania on May 30. With U.S. President Donald Trump having approved a partnership between Nippon Steel Corp. and U.S. Steel Corp., the Japanese company's acquisition of U.S. Steel is expected to be realized. The Trump administration appears to have concluded that by signing a national security agreement with Nippon Steel and acquiring a 'golden share' in U.S. Steel the administration can contain opposition from hard-liners who support an 'America First' policy. Eighteen months after the plan was announced, negotiations between Japan and the United States over the acquisition, a development that escalated into a diplomatic issue, are set to conclude. Change of mind Trump, who views the steel industry as a critical sector directly linked to national security, has referred to U.S. Steel — once the world's largest steel manufacturer — as a 'symbol of America' and had opposed Nippon Steel's bid to acquire it. What prompted Trump to change his mind were Nippon Steel's proposed additional investments and the Japanese company's measures to mitigate security threats. Nippon Steel increased the amount it would invest in the U.S. company after acquiring it from $2.7 billion to $14 billion (about ¥2 trillion). It is also believed that Nippon Steel promised that the majority of U.S. Steel's board members would be U.S. nationals and that the company's production capacity would not be reduced. In response to these proposals, local lawmakers and other interested parties in Pennsylvania, where U.S. Steel is headquartered, moved to persuade Trump, apparently by pointing out the economic benefits of the acquisition, such as employment and plant modernization. In addition, key U.S. Cabinet members including Treasury Secretary Scott Bessent — who also chairs the Committee on Foreign Investment in the United States, whose duties include reviewing foreign acquisitions — and Commerce Secretary Howard Lutnick are said to have urged Trump to approve the acquisition. Trump himself began to judge that Nippon Steel's huge investment would benefit his administration and leaned toward approving the acquisition. Political risk However, the acquisition could give the impression to the American people that a symbolic U.S. company is being sold to a foreign company, which would pose a significant political risk for Trump. Even within his administration, senior officials who support his 'America First' policy position opposed the acquisition. Avoiding backlash from his supporters was also necessary with the 2026 midterm elections in mind. As negotiations between the Japanese and U.S. steel companies progressed behind the scenes, there emerged the idea of issuing a golden share to the U.S. administration to grant it veto power over important management decisions. According to sources, the initial U.S. plan was to approve the acquisition on the condition that a national security agreement was signed, but in the final stages of the negotiations, the U.S. side demanded a golden share. Trump apparently judged that acquiring a golden share in U.S. Steel as a symbol of 'U.S. control' would help persuade opponents of the acquisition and gain the understanding of Trump's supporters. The executive order that Trump signed Friday also made no mention of the fact that U.S. Steel would come under foreign ownership. Intentions of both sides It can be said the golden share proposal led Trump to be able to successfully utilize Nippon Steel's financial strength and technological capabilities without compromising his 'America First' policy stance. Meanwhile, Nippon Steel has concluded that the golden share provides no voting rights and is largely symbolic, so the U.S. administration's influence on management and investment decisions will be limited. 'We will have 100% of the voting rights in U.S. Steel, so management freedom will be maintained,' a senior Nippon Steel executive said. Nippon Steel has previously insisted that 100% ownership of shares is a prerequisite for major investments, and the U.S. government has also refused to compromise over 'U.S. control.' Amid conflicting interests between the two parties, the idea of a golden share ultimately served as a solution, but challenges remain.
Nikkei Asia
an hour ago
- Nikkei Asia
Israel and Iran hit each other overnight as conflict continues
JERUSALEM/DUBAI (Reuters) -- Israel and Iran launched fresh attacks on each other overnight into Sunday, killing scores and raising fears of a wider conflict, as U.S. President Donald Trump said it could be ended easily while warning Tehran not to strike any U.S. targets. Israeli rescue teams combed through rubble of residential buildings destroyed by Iranian missiles, using sniffer dogs and heavy excavators to look for survivors after at least 10 people, including children, were killed, raising the two-day toll to 13.
2 hours ago
Japan's Marine Product Exports in 2024: Finding New Markets Amid Chinese Ban
Japan Data A total Chinese ban on Japanese seafood through 2024 meant Japan had to develop new markets. China has maintained a total ban on imports of Japanese seafood products since August 24, 2023, when the first treated water from Fukushima Daiichi Nuclear Power Station was discharged into the ocean. Since then, the Japanese government has offered repeated explanations on the safety of the water and proper management of the releases, calling for the lifting of the import ban. On May 30 of this year, it was announced that the Japanese and Chinese governments have agreed to begin procedures aimed at the resumption of seafood exports to China. In 2022, prior to the discharge of treated water, Japan's exports of marine products totaled ¥387.3 billion, with China accounting for ¥87.1 billion or 22.5%, making it the largest export destination. In 2024, when the ban was in effect for the entire year, exports to China plummeted to just ¥6.1 billion, consisting only of non-food marine products such as pearls and koi carp. Despite efforts to cultivate new markets in places including Hong Kong and the United States, total seafood exports for that year were ¥26.4 billion lower than in 2022. Japan's main export marine product is scallops (including fresh, frozen, chilled, and dried). In 2022, exports of scallops reached a record high of ¥91 billion, a 40% increase over the previous year, with exports to China accounting for ¥46.7 billion or 51.3%. Exports of scallops to China only totaled ¥700 million in 2009, but from the following year sales steadily increased. With the boom in Japanese cuisine, fresh scallops in the shell began to be transported by plane to Beijing, Shanghai, and other cities. Chinese businesses also began to import shelled scallops from Japan, shuck them domestically, and then re-export them to the United States, which is the largest consumer of scallops. Scallop exports declined in 2023, clearly reflecting the four months of the ban following the discharge of treated water. The following year, efforts were made to compensate for exports to China dropping to zero by redirecting exports of scallops to the United States. Exports of seafood to the United States also face risk, however, due to the proposed tariffs of President Donald Trump. It is hoped that the resumption of exports to China could help to avoid a further decline in Japanese seafood exports. (Translated from Japanese. Banner photo © Pixta.)
