Trump hails Nippon Steel as 'great partner' for US Steel in raucous rally

CNA

5 days ago

WEST MIFFLIN, Pennsylvania :U.S. President Donald Trump on Friday lauded an "agreement" between Nippon Steel and U.S. Steel at a political rally but stopped short of clarifying whether he planned to approve the companies' diplomatically sensitive merger.
On a Pittsburgh, Pennsylvania-area stage decorated with signs celebrating "American steel," Trump declared the American steel company would remain American, while extolling its new Japanese partner. It is unclear whether he approves of a deal giving Nippon ownership, as sought by the firms, or whether he had formally given the merger the green light.
"We're here today to celebrate a blockbuster agreement that will ensure this storied American company stays an American company," Trump told more than 1,600 people, including hard hat-wearing workers. "You're going to stay an American company, you know that, right? But we're going to have a great partner."
The Japanese firm's planned acquisition of U.S. Steel, initially floated in 2023, divided the politically important state of Pennsylvania and its heavily unionized blue-collar workforce, and introduced tension into the normally friendly relations between Tokyo and Washington.
Proponents of the transaction had hoped Trump's visit would end a tumultuous 18-month effort by Nippon Steel to buy the iconic American company, beset by opposition from union leadership and two national security reviews.
Trump said the company would be "controlled by the USA," that no layoffs or outsourcing would occur, and that Nippon would invest billions of dollars to modernize U.S. steel mills to increase production.
He also announced a plan, set to be implemented next week, to hike tariffs on imported steel from 25 per cent to 50 per cent.
But Trump's remarks on Friday shed no further light on the contours of a deal that he would approve or whether a formal green light was in the offing.
"I have to tell you about Nippon, they kept asking me over and I kept rejecting - no way," Trump said, adding "I'm going to be watching over it, that it's going to be great."
The White House and the companies have not responded to requests for comment on the status of deal talks.
Trump announced the rally and appeared to endorse the merger last Friday in a social media post, sending U.S. Steel's share price up over 20 per cent as investors bet he would soon give it the go ahead.
On Sunday, he sowed doubt, describing the deal to reporters not as the full takeover Nippon is seeking but as an investment with "partial ownership," and control residing in the United States.
U.S. Steel is headquartered in Pennsylvania, which symbolized both the one-time strength and the decline of U.S. manufacturing power as the Rust Belt's steel plants and factories lost business to international rivals.
The closely contested state is a major prize in presidential elections.
"We would not be here today without President Trump, who has secured the company's future by approving our partnership," said Nippon Vice-Chair Takahiro Mori, who spoke before Trump.
But in a sign of the many open questions that remain, Japan's top trade negotiator, Ryosei Akazawa, told reporters on Friday he could not yet comment on the tie-up.
"I am aware of the various reports and posts by President Trump on social media. However, there has not yet been an official announcement from the U.S. government," Akazawa, in Washington for tariff negotiations, said at a briefing at the Japanese Embassy in Washington.
Trump technically has until Thursday to decide whether to formally approve or scuttle the deal, after the Committee on Foreign Investment in the U.S. last week completed a second review of the merger. But the timeline could slip.
The road to Friday's rally has been a bumpy one.
Nippon Steel offered $14.9 billion for U.S. Steel in December 2023, seeking to capitalize on an expected ramp up in steel purchases, thanks to the bipartisan infrastructure law.
But the tie-up faced headwinds from the start, with both then-President Joe Biden and Trump asserting U.S. Steel should remain American-owned as they sought to woo voters in Pennsylvania ahead of the November presidential elections.
Following the previous review, Biden blocked the deal in January on national security grounds. The companies sued, arguing they did not receive a fair review process, a charge the Biden White House disputed.
The steel giants saw a new opportunity in the Trump administration, which opened a fresh 45-day national security review into the proposed merger last month.
But Trump's public comments, ranging from welcoming a simple "investment" in U.S. Steel by the Japanese firm to suggesting a minority stake for Nippon Steel, did little to shore up investor confidence.