Nippon Steel Affirms Management Control After U.S. Deal

TOKYO, June 20, 2025 — Nippon Steel’s top executive said Thursday the company retains full management freedom following its $14.9 billion acquisition of U.S. Steel, despite the U.S. government holding a golden share that grants significant oversight.

Eiji Hashimoto, CEO of Japan’s largest steelmaker, told reporters in Tokyo that the unusual agreement with the U.S. government, which includes the authority to name a board member — will not restrict the company from making operational decisions. “We won’t be constrained in pursuing anything we aim to do,” he said at a press conference.

The acquisition, finalized this week, ends an 18-month campaign marked by political resistance in Washington and concerns over national security. The golden share, part of an agreement struck with former President Donald Trump’s administration, gives the government veto power over several strategic decisions, including relocating U.S. Steel’s headquarters from Pittsburgh or shifting jobs overseas.

Eiji emphasized that Nippon Steel voluntarily proposed the golden share arrangement as a way to acknowledge Washington’s desire for oversight. “We retain sufficient managerial freedom,” he said.

The agreement also requires Nippon Steel to invest approximately $11 billion in the United States by 2028. Eiji said the company is prepared for that obligation and even plans to exceed it. “Our global strategy is starting to take shape,” he said, adding that further expansion remains on the table.

Still, the structure of the deal has raised questions. Analysts at Jefferies noted that the golden share could constrain Nippon Steel’s flexibility, particularly as it considers spending between 5 trillion and 10 trillion yen on decarbonization initiatives.

Nippon Steel Vice Chairman Takahiro Mori, who led negotiations, said the company may consider capital raising to support its investment plans. Meanwhile, activist investor Strategic Capital has proposed a clawback of executive compensation if the deal leads to impairments, a move the company opposes.

“I am concerned that Nippon Steel’s final goal was to acquire U.S. Steel, not boosting returns to shareholders,” said Tsuyoshi Maruki, CEO of Strategic Capital.

Moody’s Ratings expressed caution, citing the company’s increased debt load. “The increased leverage from acquisition debt remains a clear credit negative,” said Roman Schorr, senior analyst at Moody’s. However, he noted the acquisition’s strategic value in gaining tariff-shielded access to the U.S. market and recent infrastructure investments by U.S. Steel.

Market response was positive. Nippon Steel’s shares rose 2.5 percent to 2,772 yen in afternoon trading, outperforming the Nikkei 225 index, which fell 0.9 percent.

Weston Nakamura, a market analyst and publisher of the Across the Spread newsletter, called the U.S. oversight “a purely political and symbolic throwback.” He said the golden share is unlikely to interfere with current operations but could present challenges if Nippon Steel seeks to acquire another American steelmaker.

We won’t be constrained in pursuing anything we aim to do.