Nippon Steel Corp. has bolstered its pledge to invest in United States Steel Corp. in the event that President Donald Trump approves the Japanese company’s proposed $14.1 billion takeover, according to people familiar with the matter.
Nippon Steel is now offering to build a new steel mill, save existing steelworker jobs and potentially add many more unionized roles, said the people, who asked not to be identified because the latest plan hasn’t been published.
The higher investment commitment was negotiated by the Trump administration, they said. It’s still not clear whether Trump will ultimately approve the deal, they said.
The saga over the acquisition of U.S. Steel has dragged on for 17 months. Despite support from the U.S. company’s management, the proposed transaction attracted scorn from the United Steelworkers union and both candidates in last year’s presidential election. Joe Biden subsequently blocked the takeover in the final days of his administration, following a review by the Committee on Foreign Investment in the United States.
Despite Trump last month reiterating his opposition to U.S. Steel being acquired by a Japanese company, Nippon Steel is still holding out the hope that the deal can be rescued. Trump has ordered another CFIUS review of the national security implications of the combination of both companies. The deadline for that report to be submitted to the president is Wednesday.
Nippon Steel and U.S. Steel both declined to comment. The White House didn’t immediately respond to a request for comment. Shares of U.S. Steel rose 3.2% to close at $41.62 in New York. Nippon Steel has proposed paying $55 per share. Nippon Steel’s American depositary receipts dropped 2%.
Reuters reported earlier about the new steel mill as part of an enhanced $14 billion investment plan should the takeover proceed.
Nippon Steel told investors on a call last week that they didn’t expect any formal announcement from the White House until the June 5 statutory deadline for Trump to make a decision, according to people familiar with the matter. The company also didn’t rule out a possible extension of the merger agreement, indicating that a decision by the government could be pushed out to a later date, the people said.
