U.S. Steel's Golden Share Twist: National Security vs. Foreign Investment

Shares of U.S. Steel surged after Nippon Steel's $14.9-billion bid approached finalization. A 'golden share' suggested by President Trump grants significant U.S. control, sparking investor concerns. The golden share ensures U.S. interests are protected in future decisions despite the Japanese firm's acquisition.

Shares of U.S. Steel saw a boost of 5% following developments in Nippon Steel's $14.9-billion acquisition bid, now nearing completion. The offer comes amid revelations of a 'golden share' held by the U.S. government, announced over the weekend.

The 'golden share', introduced by President Trump, ostensibly provides the American government with a 51% stake in U.S. Steel, raising concerns about control and influence. National security lawyer Josh Gruenspecht expressed that this unconventional move might deter foreign investment due to uncertainties in asset control.

The proposal, involving complex agreements, safeguards national interests by preventing shifts in investment and operations, such as keeping production within the U.S. as outlined in a September 2024 term sheet submitted to the CFIUS.

(With inputs from agencies.)