Nippon Steel and US Steel are actively negotiating a deal to preserve their proposed $14 billion merger, with discussions focusing on increasing investment in Rust Belt manufacturing facilities, according to a report from Semafor.
In recent meetings with White House officials, Nippon Steel has reportedly offered to raise its initial $2.7 billion investment in US Steel factory upgrades to as much as $7 billion, Semafor reported, citing sources familiar with the talks.
While Nippon Steel declined to comment, US Steel has not yet responded to media inquiries.
Nippon Steel President Tadashi Imai stated on Monday that the company, Japan’s largest steelmaker, remains committed to negotiations with the US government to finalize the terms of an equity purchase and investment plan.
Discussions around the merger have taken on a political dimension. In February, President Donald Trump and Japanese Prime Minister Shigeru Ishiba indicated that the $14.9 billion bid for US Steel could take the form of an investment rather than a full acquisition. Trump also stated that he would be open to Nippon Steel acquiring a minority stake in US Steel instead of a full takeover.
Following reports of the increased investment offer:
US Steel shares rose more than 7% in after-hours trading in New York on Thursday.
Nippon Steel’s stock fell 3.6% in Tokyo trading on Friday, marking its largest intraday decline since September 11.
Originally announced in December 2023, the proposed merger has faced scrutiny over concerns about foreign ownership of a major US steel producer. Nippon Steel has pledged to modernize US Steel’s infrastructure and maintain its headquarters in Pittsburgh, Pennsylvania, as part of its bid to gain regulatory approval.
