Nippon Steel Confident in $14.1 Billion Acquisition of U.S. Steel Despite Trump’s Opposition

Nippon Steel Corporation remains optimistic about the completion of its $14.1 billion acquisition of U.S. Steel Corporation by the end of the year, despite facing significant political opposition from both the outgoing and incoming U.S. presidents. The deal, which has been under scrutiny for nearly a year, is currently under review by the Committee on Foreign Investment in the United States (CFIUS), an interagency panel tasked with assessing foreign investments that may affect U.S. national security.

Takahiro Mori, Vice President of Nippon Steel, expressed confidence during a recent interview that the acquisition would proceed as planned if it passes through the necessary regulatory processes. "We are determined to protect and grow U.S. Steel in a manner that reinforces American industry, domestic supply chain resiliency, and U.S. national security," Mori said. He added that the company was committed to investing at least $2.7 billion into U.S. Steel's unionized facilities, introducing advanced technologies, and securing union jobs for American steelworkers.

The deal, which was initially announced in December 2023, has been embroiled in a series of political challenges. President-elect Donald Trump, who will take office in January 2025, has voiced strong opposition to the acquisition. In a statement on Truth Social, Trump pledged to block the deal, writing, "I am totally against the once great and powerful U.S. steel being bought by a foreign company, in this case, Nippon Steel of Japan." He emphasized that he would use tariffs and tax incentives to revitalize U.S. Steel and promised that U.S. Steel would "become strong and great again."

Trump's stance aligns with his broader protectionist economic policies, which aim to support domestic manufacturing through tariffs and other measures. Throughout his campaign, he has insisted that tariffs are crucial for revitalizing American industries, including steel, and encouraging foreign companies to build plants within the U.S. "As President, I will block this deal from happening. Buyer beware!!!," he added.

Mori has emphasized that his recent visit to the U.S. garnered positive feedback from local communities. He declined to provide specific details but noted that there is now "more momentum among local communities for the deal versus when we first started the talks." The local support may reflect the significant investments that Nippon Steel has pledged to make in U.S. Steel's operations, which include modernizing facilities and ensuring that the company remains competitive globally.

The CFIUS review of the deal, which was extended until after the November 2024 presidential election, continues to be a critical factor in the timeline for the acquisition. The Biden administration, which has previously expressed concerns over the potential national security implications of the deal, could still block the transaction. While President Biden has not publicly stated his final position, sources close to the administration suggest that there are reservations about the deal's impact on U.S. steel industry sovereignty.

This acquisition represents a strong stance for Nippon to expand its global footprint and strengthen its position in the North American market. U.S. Steel is one of the oldest and most iconic steelmakers in the U.S, it would continue to operate under its well-known brand and keep its headquarters in Pittsburgh if the deal proceeds.

However, U.S. Steel has warned that if the deal does not go through, the company may be forced to close many of its blast furnace facilities, which could result in the loss of thousands of jobs and make it more challenging for the company to compete in an increasingly globalized market.