The U.S. government is planning to participate in the planned “partnership” between U.S. Steel and its Japanese rival Nippon Steel, Senator Dave McCormick, a Republican from Pennsylvania, said on CNBC on Tuesday.
Mr. McCormick said that as part of a national security agreement that the companies will sign with the Trump administration, the federal government will get a so-called “golden share” in the deal. As a result, the administration will have a say in who is appointed to the company’s board from the United States.
On Friday, President Trump said that he was favoring a $14 billion “investment” by the Japanese giant in U.S. Steel, without disclosing any ownership details. The president had previously said he opposed Nippon Steel’s outright acquisition of the American manufacturer. U.S. Steel is headquartered in Pennsylvania, a politically important state that voted for Mr. Trump in 2024.
Mr. McCormick did not expand upon how the arrangement might work and the companies have not disclosed any details of the investment.
Golden shares typically refer to special stakes the government takes in companies that are ailing or in particular need of government attention, like General Motors during the 2008 financial crisis. The United States doesn’t typically take shares in publicly traded companies. When it does, it’s usually because it has provided some type of financial assistance, like a bailout, and wants to protect taxpayer money.
The arrangement sparked immediate concern.
“It makes no sense for the United States to take a stake in it,” Douglas Holtz-Eakin, the president of the American Action Forum, said in an interview. The conservative group criticized the Biden administration for raising national security objections to Nippon’s takeover, arguing that it posed no risk to the United States.
Mr. Holtz-Eakin said it was unclear what, exactly, the president envisions with the golden share.
“What does it do for U.S. Steel? Nothing,” he said. “It’s got another manager that doesn’t have a sort of business interest in it, and a completely different set of priorities on national security and other things.”
Nippon had been trying to acquire U.S. Steel, which has faced financial difficulty for years, for $14 billion. But former President Joseph R. Biden, Jr., blocked the deal on national security grounds, citing concerns about a U.S. industrial giant being acquired by a Japanese company.
It was a rare moment of bipartisan agreement, with Mr. Trump also saying on the campaign trail that he would not allow U.S. Steel to be owned by a foreign company.
On Sunday, Mr. Trump insisted the arrangement he said he brokered would keep the company American-owned.
“It will be controlled by the United States, otherwise I wouldn’t make the deal,” Mr. Trump said. “It’s an investment and it’s a partial ownership, but it will be controlled by the U.S.A.”
Mr. McCormick, who said he had met with “several colleagues” alongside Mr. Trump the day before the Friday announcement, called the ownership structure “somewhat unique.” The resulting “partnership” will have a U.S. chief executive and a majority U.S. board, he said.
“This structure allows us to get the investment to get the next generation technology from Nippon, which is a world leader, but also protect our U.S. national security interest,” Mr. McCormick said.
Representatives for U.S. Steel and Nippon Steel did not immediately respond to a request for comment. The White House did not immediately respond to a request for comment.
David McCall, the president of the United Steelworkers union, which had vehemently opposed a sale of U.S. Steel to Nippon, said in a statement that the union “can’t speculate about the government’s reported ‘golden share,’ or anything about the announced ‘partnership’ without more information.”
He added that “U.S. Steel is a critical producer in a critical domestic industry, and our concerns about Nippon, a foreign corporation with a long track record of violating U.S. trade laws, remain undiminished.”
Lauren Hirsch is a Times reporter who covers deals and dealmakers in Wall Street and Washington.
Tony Romm is a reporter covering economic policy and the Trump administration for The Times, based in Washington.
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