REGIONAL— Nippon Steel and U.S. Steel announced Monday that President Trump has approved a partnership agreement that will facilitate Nippon’s eventual control, with caveats, over America’s oldest steel firm.
In a joint statement, the companies say the partnership “will unleash unprecedented investments in steelmaking in the United States, protecting and creating more than 100,000 jobs.
“This partnership will bring a massive investment that will support our communities and families for generations to come,” stated the companies. “We look forward to putting our commitments into action to make American steelmaking and manufacturing great again.”
In addition to President Trump’s executive order approving the partnership, the companies have entered into a National Security Agreement, or NSA, with the U.S. government. The NSA provides that approximately $11 billion in new investments will be made by 2028, which includes the initial investment in a greenfield project that would be completed after 2028.
The NSA also includes commitments related to governance of the new company, to be known as Nippon Steel North America. Under the deal, the companies are authorizing a so-called “golden share” to be issued to the U.S. government, which will have veto power on some corporate decisions related to investments, trade, and national security. Some observers have compared the golden share’s authority to semi-nationalization of the country’s oldest steel company.
While President Trump has lauded the agreement and told workers in Pennsylvania last month that the partnership would generate new jobs and higher wages for workers, the United Steelworkers remain cool to the deal, questioning Nippon’s commitment to fair contract negotiations, pensions, and other worker benefits contained within the union’s negotiated contract with U.S. Steel, as well as questions about where some of the promised U.S. investment will be made.
The agreement includes a promise of investment in a major new greenfield project somewhere in the U.S., but the statement issued by the companies this week offered no details on the project.
U.S. Steel operates two taconite mines on the Iron Range, including Minntac and Keetac, and employs more than 1,800 workers combined, or nearly half of the mineworkers in the region. Eighth District Congressman Pete Stauber, who represents the Iron Range, has said the new deal is expected to bring as much as $800 million in new investment into the mining industry on the Range, although no details of where that investment might end up were made clear.