Trump gets 'golden share' power in US Steel buyout. US agencies will get it under future presidents
HARRISBURG, Pa. (AP) — President Donald Trump will control the so-called 'golden share' that's part of the national security agreement under which he allowed Japan-based Nippon Steel to buy out iconic American steelmaker U.S. Steel, according to disclosures with the U.S. Securities and Exchange Commission.
The provision gives the president the power to appoint a board member and have a say in company decisions that affect domestic steel production and competition with overseas producers.
Under the provision, Trump — or someone he designates — controls that decision-making power while he is president. However, control over those powers reverts to the Treasury Department and the Commerce Department when anyone else is president, according to the filings.
The White House didn't immediately respond to questions Wednesday about why Trump will directly control the decision-making and why it goes to the Treasury and Commerce departments under future presidents.
Nippon Steel's nearly $15 billion buyout of Pittsburgh-based U.S. Steel became final last week, making U.S. Steel a wholly owned subsidiary.
Trump has sought to characterize the acquisition as a "partnership" between the two companies after he at first vowed to block the deal — as former President Joe Biden did on his way out of the White House — before changing his mind after he became president.
The national security agreement became effective June 13 and is between Nippon Steel, as well as its American subsidiary, and the federal government, represented by the departments of Commerce and Treasury, according to the disclosures.
The complete national security agreement hasn't been published publicly, although aspects of it have been outlined in statements and securities filings made by the companies, U.S. Steel said Wednesday.
The pursuit by Nippon Steel dragged on for a year and-a-half, weighed down by national security concerns, opposition by the United Steelworkers and presidential politics in the premier battleground state of Pennsylvania, where U.S. Steel is headquartered.
The combined company will become the world's fourth-largest steelmaker in an industry dominated by Chinese companies, and bring what analysts say is Nippon Steel's top-notch technology to U.S. Steel's antiquated steelmaking processes, plus a commitment to invest $11 billion to upgrade U.S. Steel facilities.
The potential that the deal could be permanently blocked forced Nippon Steel to sweeten the deal.
That included upping its capital commitments in U.S. Steel facilities and adding the golden share provision, giving Trump the right to appoint an independent director and veto power on specific matters.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
30 minutes ago
- Yahoo
Trump's 'One Big Beautiful Bill' is getting more expensive as the world's attention is on Iran
The long-awaited summer collision course for President Trump's economic agenda is here and now competing for attention with geopolitics. The competing storylines are playing out — just in parallel — after a weekend where the president's "One Big Beautiful Bill Act" saw a new, higher price tag and the removal of key provisions in developments that were fully overshadowed by a weekend attack on Iran. Trump's priorities for taxes and the debt ceiling — not to mention tariffs — still face key deadlines in the weeks ahead, even as foreign affairs take center stage. On Saturday evening, shortly after the attacks on Iran commenced, Congress's Joint Committee on Taxation (JCT) even released an analysis that made official how recent Senate changes to Trump's tax-cut bill are likely to increase the package's price tag by hundreds of billions of dollars. The group found that the Senate's changes on the tax front — once economists untangled a key budget gimmick — mean the bill will potentially add about $4.2 trillion to the deficits in the years ahead if passed as is. The bill is also undergoing a close examination by the Senate parliamentarian, who is moving section by section and has already deemed some provisions — such as defunding the Consumer Financial Protection Bureau (CFPB) and making cuts to the Supplemental Nutrition Assistance Program (SNAP) — are not in line with Senate reconciliation rules. More changes are likely coming this week that could further increase the price tag and political pressure, even as key Republicans are still saying they will vote no, throwing into doubt a GOP goal of final votes within days. It all could also have near-term economic impacts. Wells Fargo head of global fixed income strategy Brian Rehling said in a recent Yahoo Finance appearance that developments in the bill could be "more consequential" to things like interest rates for the time being over even signals from the Federal Reserve. These developments come just weeks before Trump and the Republicans' self-imposed deadline to get the bill signed into law by July 4. Senate Majority Leader John Thune has said that means the Senate will need to pass this bill this week to keep the timeline on pace. The weekend's Joint Committee on Taxation analysis focused specifically on the Senate Finance Committee's tax proposals and offered a headline number that would appear to be good news for fiscal hawks: It found the projected cost of the revised bill comes to about $441 billion over the coming decade. But that calculation came from an accounting maneuver known as a "current policy" baseline, which allows the bill to be calculated assuming current tax levels stay the same. That means Congress can say the cost of extending expiring provisions in the 2017 Tax Cuts and Jobs Act is free, at least for accounting purposes. Republicans defend the practice, with Senate Finance Committee Chair Mike Crapo offering that it "more accurately reflects reality." But the bottom line is that these zeroed-out tax extensions are projected to add about $3.8 trillion to the national debt, versus the scenario of Congress doing nothing. "Ignore the $441 number, which is both trying to hide the cost of extensions and gimmick some specific policies to make them look cheaper," offered Marc Goldwein of the Committee for a Responsible Federal Budget following the release. Andrew Lautz of the Bipartisan Policy Center also offered a detailed breakdown of the differences brought by the assumptions, such as how it makes the approximately $2.1 trillion in costs from extending individual tax rate cuts look like they instead come to $83 billion. Goldwein, Lautz, and others say the full price tag that should be considered is the total impact to the nation's debt of $4.2 trillion over the next decade. The new price tag projections also come as Senate parliamentarian Elizabeth MacDonough is going through the bill line by line to see if it complies with the Senate's strict reconciliation rules. It's part of a wonky Senate process known colloquially as a "Byrd bath," after a rule enshrined by Robert Byrd of West Virginia, that sets limits on what can be fast-tracked and what is subject to the normal 60-vote threshold. MacDonough has already analyzed the Banking, Commerce, Judiciary, and Homeland Security committee portions of the bill and found a series of provisions that must be taken out. So far, pieces that appear set to be removed from the bill include one that would have placed a funding cap on the Consumer Financial Protection Bureau (CFPB) and others that cut the SNAP program. The apparent removal of cuts to the SNAP program around state matching funds could have a significant fiscal impact. Those provisions were previously estimated to save roughly $128 billion. One other closely watched provision by the tech community — to cut broadband funding for states that regulate artificial intelligence — has been allowed to stay in but still faces political opponents pushing to have it struck from the package. It's a series of rulings that Republicans contend aren't yet final but appear set to change the makeup of the overall package. "The Byrd Rule is enshrined in law for a reason, and Democrats are making sure it is enforced," Oregon's Jeff Merkley, the top Democratic senator on the Budget Committee, said in a statement. Even more significant changes could be coming in the days ahead, with the parliamentarian scheduled to take a pass at the Senate Finance Committee's portion of the bill. That's where the biggest ticket items reside, such as tax provisions and Medicaid cuts. Ben Werschkul is a Washington correspondent for Yahoo Finance. Click here for political news related to business and money policies that will shape tomorrow's stock prices Sign in to access your portfolio
Miami Herald
35 minutes ago
- Miami Herald
Legendary fund manager makes bold S&P 500 prediction as stocks near all-time highs
It's been a remarkable ride since President Donald Trump announced widespread tariffs on April 2. Trump's so-called "Liberation Day" announcement included harsher tariff rates than hoped, forcing investors to rethink their expectations for the U.S. economy. There's evidence that a U.S. economic slowdown is underway, and despite tariff negotiations, tariffs could still push the economy into stagflation or recession. The economic risk raises questions over what's likely to happen to stocks, which usually perform best when a humming economy fattens wallets, allowing households and businesses to ramp up spending. The post-Liberation Day stock market drop lopped 19% and 24% off the S&P 500 and Nasdaq Composite, respectively, from all-time highs in February. Related: Wall Street veteran analyst who predicted stock market rally resets forecast The decline was concerning, but "buy the dip" investors took advantage, boosting buys into extremely negative sentiment with most measures flashing "oversold." Since April 9, when President Trump paused most reciprocal tariffs that had been announced on April 2, the S&P 500 and Nasdaq 100 have rocketed higher, gaining 22% and 30%. The returns have been so significant that major market indexes, including the benchmark S&P 500, are flirting with all-time highs again, prompting veteran Wall Street bond manager Bill Gross to chime in with an updated outlook. Gross has been navigating good and bad markets since 1971. He is the co-founder of Pacific Investment Management Co., or PIMCO, a Goliath money manager with $2 trillion under management. His former role atop the $270 billion PIMCO Total Return Fund earned him the "Bond King" moniker before he left to join Janus Henderson Investors from 2014 to 2019. Given his long track record, investors may want to pay attention to what he's thinking happens next. Many are debating what may happen to the economy next. Some believe that tariffs will tax already cash-strapped consumers later this year, slowing economic activity, as businesses also crimp spending awaiting trade deal insight. Others think tariff risks are fleeting and overblown. The jobs market remains healthy, given that unemployment is relatively low at 4.2%. However, the unemployment rate was 3.4% in 2023, and companies have announced over 696,000 layoffs this year, including 93,816 job cuts in May, up 47% year over year, according to Challenger, Grey, & Christmas. Related: Analyst sends blunt 8-word message ahead of trade deal deadline The weakening jobs market prompted the Federal Reserve to cut interest rates by 1% last year; however, it has since gone to the sidelines, pausing further cuts, over fear that more reductions could fuel inflation, particularly given that the tariff impact is only beginning to be felt by consumers and businesses. The dilly-dallying on monetary policy has prompted sharp criticism, though, including from the White House. Ostensibly, recognizing that tariffs may slow GDP and worsen unemployment, President Trump has threatened to fire Fed Chair Jerome Powell, and his Director of the Federal Housing Finance Agency, William (Bill) Pulte, has called for his resignation. If the economy cools and the Fed is unwilling to budge on interest rates, Congress may not be able to help, given that the country's huge deficit and mountain of debt are impacting fiscal policy. America's deficit exceeds $1.8 trillion, accounting for 6.4% of gross domestic product. At the same time, total public debt outstanding is roughly 122% of GDP, far higher than its 75% level in 2008 during the Great Recession. The economic backdrop threatens earnings growth, but the stock market has so far looked beyond the risks, assuming that trade negotiations will bear fruit, inflation expectations will retreat, and corporate earnings will continue growing, rather than ratchet lower. The fact that Bill Gross has been tracking Wall Street for over 50 years means he's seen plenty of stock market pops and drops, including the Nifty 50, skyrocketing inflation in the 1970s, the S&L crisis in the late 80s and early 90s, the Internet boom and bust, the Great Recession, Covid, and the 2002 bear market. More Experts Fed official sends strong message about interest-rate cutsBillionaire fund manager sends surprising message on trade deficitHedge-fund manager sees U.S. becoming Greece In short, Gross has been-there, done-that, so his take on markets is worth paying attention to. He doesn't see much reason to be a buyer of US Treasuries. Many turn to Treasuries as a safe haven amid economic or geopolitical worry. Given the economic risks listed above, the ongoing Russia/Ukraine War, and a dust-up in the Middle East, we certainly have that. Yet, Treasury yields haven't made much progress lower (remember yields fall when bond prices rise and vice versa). Gross doesn't think there's much incentive for them to fall much further. "Long-term research indicates US 10 year has traded at CPI plus 175," wrote Gross on X. "With inflation at 2.5% that puts a 10 year at 4.25% or so. That was history - but deficits/ensuing supply of bonds/and a weak dollar should keep CPI from falling below 2.5% and the 10-year from falling below 4.25%." The 10-year Treasury note yield is currently 4.29%. As a result, he predicts a "little bear market for bonds." With little incentive to shift portfolios towards Treasuries for gains, what does that mean for stocks? "Stocks are AI-dominated and continue to suggest 1-2% economic growth despite tariffs and geopolitical unrest," wrote Gross. "I suggest a "little bull market" for stocks." Undeniably, artificial intelligence stocks continue to win favor with investors as companies big and small look for ways to exploit it for profit growth. After a pause earlier this year, technology stocks have turned it on lately. The SPDR Technology ETF (XLK) is up about 8% in June alone, and unlike the S&P 500, it has already notched a new all-time high. That said, don't get too excited. Gross doesn't seem to expect much more upside than we've already witnessed. "Nothing dramatic either way for now," concluded Gross. Related: Veteran fund manager sends dire message on stocks The Arena Media Brands, LLC THESTREET is a registered trademark of TheStreet, Inc.
Yahoo
40 minutes ago
- Yahoo
CIA director says Iran's nuclear sites 'severely damaged'
The head of the CIA has said US strikes "severely damaged" Iran's nuclear facilities and set them back years, diverging from a leaked intelligence report that angered President Donald Trump by downplaying the raid's impact. John Ratcliffe, the US spy agency's director, said key sites had been destroyed, though he stopped short of declaring that Iran's nuclear programme had been eliminated outright. It comes a day after a leaked preliminary assessment from a Pentagon intelligence agency suggested core components of Iran's nuclear programme remained intact after the US bombings. President Trump again maintained the raid had "obliterated" Iran's nuclear facilities. The Republican president took to social media on Wednesday to post that the "fake news" media had "lied and totally misrepresented the facts, none of which they had". He said Secretary of Defence Pete Hegseth and other military officials would hold an "interesting and irrefutable" news conference on Thursday at the Pentagon "in order to fight for the Dignity of our Great American Pilots". It came as Israel and Iran seemed to honour a fragile ceasefire that Trump helped negotiate this week on the 12th day of the war. Speaking at The Hague where he attended a Nato summit on Wednesday, Trump said of the strikes: "It was very severe. It was obliteration." He also said he would probably seek a commitment from Iran to end its nuclear ambitions at talks next week. Iran has not acknowledged any such negotiations. But US Middle East envoy Steve Witkoff told US network NBC there has been direct and indirect communication between the countries. Ratcliffe's statement said the CIA's information included "new intelligence from an historically reliable and accurate source/method that several key Iranian nuclear facilities were destroyed and would have to be rebuilt over the course of years". Director of National Intelligence Tulsi Gabbard has also come out in support of Trump's assessment on the damage to Iranian nuclear facilities. "If the Iranians chose to rebuild, they would have to rebuild all three facilities (Natanz, Fordo, Esfahan) entirely, which would likely take years to do," she wrote on X. The US operation involved 125 military aircraft, targeting the three main Iranian nuclear facilities on Saturday. New satellite images show six craters clustered around two entry points at Fordo, with similar craters spotted at Isfahan. But it is unclear if the nuclear facilities located deep underground were wiped out. A report from the Pentagon's Defense Intelligence Agency was leaked to US media on Tuesday, estimating that the US bombing had set back Iran's nuclear programme "only a few months". The US defence secretary said that assessment was made with "low confidence". How much does leaked US report on Iran's nuclear sites tell us? Satellite images reveal new signs of damage at Iranian nuclear sites Make Iran Great Again? 'Tehrangeles' community in LA reflects on US strikes Officials familiar with the evaluation cautioned it was an early assessment that could change as more information emerges. The US has 18 intelligence agencies, which sometimes produce conflicting reports based on their mission and area of expertise. UN nuclear watchdog chief Rafael Grossi said on Wednesday that there is a chance Tehran moved much of its highly enriched uranium elsewhere as it came under attack. But Iranian foreign ministry spokesman Esmail Baghaei told Al Jazeera on Wednesday: "Our nuclear installations have been badly damaged, that's for sure." He did not elaborate. A report by the Israeli Atomic Energy Commission said the strike on Fordo "destroyed the site's critical infrastructure". The damage across all the sites, the report said, has pushed Iran's timeline for nuclear weapons back by "many years". Yet Mehdi Mohammadi, an adviser to the chairman of the Iranian parliament, said shortly after the US strikes that "no irreversible damage was sustained" at Fordo. Iran has long maintained that its nuclear programme is peaceful. US intelligence agencies have previously said Tehran was not actively building atomic weapons.
