To facilitate its takeover of U.S. Steel, Japan’s Nippon Steel has agreed to a groundbreaking arrangement, enabling the U.S. government to obtain a "golden share." This unique deal grants President Trump—and future presidents—extraordinary control over a private corporation, possibly altering the landscape of foreign investments in the United States.
New insights into the agreement reveal an arrangement in which the White House maintains a permanent stake in U.S. Steel, empowering it to dictate board decisions and impose vetoes on various corporate actions. The negotiations, which transpired late into the night on Wednesday and Thursday, saw Nippon Steel discuss the acquisition of U.S. Steel—a venture initially blocked by the Biden administration due to national security concerns—while conceding to Trump's demands for significant governmental influence.
Initially, Nippon Steel proposed granting the U.S. government this influence for a limited duration, potentially lasting three to four years as long as Trump remained in office. However, negotiations at the Commerce Department, led by Commerce Secretary Howard Lutnick, resulted in the "golden share" arrangement being established indefinitely.
As part of the national security agreement, signed by the companies on Friday, the U.S. government will hold one preferred stock share, denoted as class G—indicating its significant privileges. The charter of U.S. Steel will enumerate nearly a dozen activities that the company cannot pursue without authorization from the President or an official he appoints as his representative.
