Trump used ‘golden share’ to block U.S. Steel’s production halt plan: WSJ– japantoday.com
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The U.S. government blocked United States Steel Corp’s plan to shut down production at a plant in the Midwest, resorting to its new authority over the company, which has been acquired by Nippon Steel Corp, The Wall Street Journal reported Friday.
As part of the $14.1 billion takeover deal of the iconic yet struggling American steelmaker by the Japanese company that was finalized in June, the U.S. government was granted a “golden share” that gives it veto power over key management decisions.
According to the newspaper, U.S. Steel notified workers in Granite City in the state of Illinois two weeks ago that plant operations would cease in November. Nippon Steel said it would continue to pay the mill’s nearly 800 employees despite the closure.
But U.S. Commerce Secretary Howard Lutnick reportedly called U.S. Steel CEO David Burritt and told him that the administration would not allow operations to cease, and President Donald Trump would invoke the “golden share” authority over plant operations.
U.S. Steel therefore reversed its plan and said that Granite City Works will continue rolling steel slabs into sheet steel, according to the WSJ.
U.S. Steel told Kyodo News that the company is “pleased to have found a solution to continue slab consumption at Granite City,” noting that its goal was to “maintain flexibility.”
An official of Nippon Steel declined to comment on the production halt plan and the involvement of the U.S. government.
“We are not in a feud with the U.S. administration,” the official said.
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