U.S. Steel stock prices declined by 4% on Friday after Nippon Steel’s executive stated that operational independence must be secured for the $14.9 billion acquisition to proceed. The Japanese steelmaker continues to discuss terms with the U.S. government through these statements.
The executive from Nippon Steel told Nikkei newspaper that the deal could fail if management freedom is not established because of political interference including President Trump’s claim about a “golden share” that grants Americans majority control.
Sources close to the situation indicate that the companies might reach a final agreement in the near future despite ongoing tensions. The White House together with Nippon Steel and U.S. Steel maintain silence about the matter. The companies initiated lawsuits against the Biden administration after the administration blocked their acquisition on national security grounds.
The review process began again in April after Trump took office but his inconsistent statements about supporting investment while opposing foreign ownership have generated confusion.
The acquisition faces ongoing political challenges because both presidential candidates have made keeping U.S. Steel under American ownership a central part of their campaigns in Pennsylvania. Nippon’s request for operational independence has emerged as a key obstacle for the two companies to reach an agreement.
