Investors interpreted Trump’s comments as meaning that Nippon Steel has been approved for the acquisition of US steel.
US President Donald Trump has expressed support for the US steel bid of $14.9 billion, saying that the “planned partnership” will create jobs and support the US economy.
U.S. steel shares surged 21% on Friday after investors interpreted the president’s post on true social.
“This will be a planned partnership between US Steel and Nippon Steel, creating at least 70,000 jobs and adding $14 billion to the US economy,” Trump said in his post on Truth Social on Friday.
This week, Reuters reported that if Nippon Steel is approved for the merger, it will invest $14 billion in US steel operations, including up to $4 billion in its new steel factory.
Trump added that the majority of his investment will occur in the next 14 months and said he will hold a rally in Pittsburgh’s US Steel next Friday.
Nippon Steel said it praised Trump’s decision to approve the “partnership.” The White House did not immediately respond to questions about the announcement.
US steel stock prices continued to rise after opening hours, reaching $54. I was shy about Nippon Steel’s share offer price of $55 per $55 in late 2023.
Political debate
The deal is one of the most anticipated on Wall Street after it transformed into a political stage with fear that foreign ownership in Pennsylvania, where US steel is based, would mean job losses. Seeing Trump’s return to the White House, he was factored into last year’s election.
Pennsylvania Sen. Dave McCormick said Friday that he also called the deal “partnership” was a “big victory for the US and the US steel company,” protecting more than 11,000 Pennsylvania jobs and helping create at least 14,000 people.
The final part of the transaction came together surprisingly quickly. The US Foreign Investment Committee (CFIUS), which considers deals on national security risks, reported this week to the White House that it could address security risks, and that it had moved its final decision to Trump’s desk.
Following a previous CFIUS-led review, former President Joe Biden blocked the contract in January on national security reasons.
The company sued, claiming it had not received a fair review process. The Biden White House rejected that view.
The corporation claimed that Biden opposed the deal when he was running for reelection to win support from the United Steelworkers Union on the Pennsylvania battlefield. The Biden administration defended reviews that were essential to protecting security, infrastructure and supply chains.
Trump initially opposed the transaction, claiming that the company must be owned and operated in the United States.
United steel workers were opposed to the contract Thursday when Trump urged him to block the deal despite a $14 billion investment pledge from Trump.
For investors, including well-known hedge funds, the news hampers bailouts after a year or more waiting for a resolution. “There was a massive high five today,” a recent investor added, “I understood the spirit of Donald Trump and made it an advantage here.”
Investors said Trump appears to have acquired the position after the new investment pledge increased.
“The agreement ensures that steel will remain alive in Pittsburgh for generations,” another investor said.