Nippon Steel exec says firm needs freedom to manage US Steel, newspaper says
Shares of U.S. Steel dipped after a Nippon Steel executive told the Japanese Nikkei newspaper that its planned takeover of the company required "a degree of management freedom" to go ahead, even as sources told Reuters a deal with the U.S. government to greenlight the tie-up was effectively done.
"Without a degree of management freedom, it may not be possible to reach an agreement with the U.S. government," the executive said, according to the newspaper, sending shares of the iconic U.S. steelmaker down 4 per cent.
The comments appeared to take aim at remarks made by President Donald Trump, who said on Thursday that he had control over U.S. Steel via a "golden share" that gave the American people a 51 per cent stake in the company.
But two of the three people said the deal could be finalized as soon as Friday.
Nippon Steel, U.S. Steel and the White House did not immediately respond to requests for comment.
The $14.9 billion bid, first announced by Nippon Steel in December 2023, has faced opposition from the start. Both former President Joe Biden and Trump asserted last year that U.S. Steel should remain U.S.-owned, as they sought to woo voters ahead of the presidential election in Pennsylvania, where the company is headquartered.
Biden blocked the deal in January on national security grounds, prompting lawsuits by the companies, which argued the national security review they received was biased. The Biden White House disputed the charge.
The steel companies saw a new opportunity in the Trump administration, which began on January 20 and opened a fresh 45-day national security review into the proposed merger in April.
But Trump's public comments, ranging from welcoming a simple "investment" in U.S. Steel by the Japanese firm to floating a minority stake for Nippon Steel, spurred confusion.
At a rally in Pennsylvania on May 30, Trump lauded an agreement between the companies and said Nippon Steel would make a "great partner" for U.S. Steel. But he later told reporters the deal still lacked his final approval, leaving unresolved whether he would allow Nippon Steel to take ownership.
Nippon Steel and the Trump administration asked a U.S. appeals court on June 5 for an eight-day extension of a pause in litigation to give them more time to reach a deal for the Japanese firm. The pause expires Friday, but could be extended.
June 18 is the expiration date of the current acquisition contract between Nippon Steel and U.S. Steel, but the firms could agree to postpone that date.
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