Nippon Steel and US Steel said Wednesday they have finalized their "historic partnership," a deal that gives the US government a say in some matters and comes a year-and-a-half after the Japanese company first proposed its nearly $15 billion buyout of the iconic American steelmaker. The pursuit by Nippon Steel of the Pittsburgh-based company was buffeted by national security concerns and presidential politics in a premier battleground state, dragging out the transaction for more than a year after US Steel shareholders approved it, the AP reports.
Nippon had to expand the deal, including adding a "golden share" provision that gives the federal government the power to appoint a board member and a say in company decisions that affect domestic steel production and competition with overseas producers. "Together, Nippon Steel and US Steel will be a world-leading steelmaker, with best-in-class technologies and manufacturing capabilities," the companies said. The combined company will become the world's fourth-largest steelmaker and bring what analysts say is Nippon Steel's top-notch technology to US Steel's antiquated steelmaking processes, plus a commitment to invest $11 billion to upgrade US Steel facilities, per the AP. In exchange, Nippon Steel gets access to a robust US steel market, strengthened in recent years by tariffs under President Trump and former President Biden, analysts say.
Anthony Rapa, a Blank Rome lawyer in Washington who advises firms on trade, operations, and investments, said the government's intervention in the Nippon Steel-US Steel deal is another sign of a trend that the US is more and more equating economic security with national security. He doesn't see the government's intervention as chilling foreign investment and said a "golden share" mechanism—to the extent that it is used again by the US to ease national security concerns—is likely to emerge only in sensitive and complex cases. Still, the episode could cause investors to be more strategic in how they approach transactions, Rapa said.
(More
mergers and acquisitions stories.)
,
uBlock 
,
and
Ghostery 
)
