Trump Just Gave Nippon and U.S. Steel 45 Days to Win Him Over… Wall Street Sniffs Opportunity

Somewhere in the world right now, a head of state is pacing nervously, waiting on hold for President Trump to try to make a tariff deal. Meanwhile, in the Oval Office, Trump’s got the phone tucked between his ear and shoulder, a well-done steak in one hand, and a Diet Coke in the other… as he rewrites the fate of the American steel industry. Priorities.

Because yes, in the middle of global leaders trying to reach him, Trump paused the diplomacy and told the Committee on Foreign Investment in the U.S. (CFIUS) to rerun the tape on Japan’s $15 billion attempt to buy U.S. Steel. The announcement immediately sent shares soaring nearly 12%, as investors began believing the deal might still have life.

Japan’s Nippon Steel wants to buy U.S. Steel, one of the oldest symbols of American industrial muscle. And honestly their offer was solid… $15 billion, a promise to invest $2.7 billion into crumbling U.S. plants, no layoffs, $5,000 bonuses for workers, and a pinky swear to honor all union deals.

Everything looked smooth… until President Biden blocked it late last year, citing “national security concerns.” Which, you know, is an interesting take considering Japan is one of our oldest allies and not exactly running up on us with samurai swords.

That’s where Cleveland Cliffs and their CEO Lourenco Goncalves come in… a man who apparently moonlights as a political magician. After Nippon outbid Cliffs in 2023, Goncalves basically rage-quit the negotiation table and instead lobbied the government to kill the deal so he could swoop in and buy U.S. Steel at a garage sale price. And it worked. At an investor conference this year, Goncalves bragged about using “magic” to block the Nippon acquisition.

But here’s where Trump comes in: He didn’t shut the deal down. Not yet.

Instead, he ordered a 45-day review to give CFIUS time to figure out if Nippon’s revised offer (now with even more investment dollars) is enough to soothe the sweaty palms of national security folks. This is classic Trump. Talk tough, stay vague, and keep himself in the spotlight. The man could hijack a Weather Channel broadcast just to tell you a hurricane looks “tremendous.”

What’s at stake isn’t just one business deal. If Cliffs were to acquire U.S. Steel, it would control nearly all of the American steel supply chain: 100% of blast furnace steel production, 89% of domestic iron ore, 100% of U.S. electrical steel, and the majority of automotive steel. That level of market dominance raises serious antitrust questions.

And spoiler alert… monopolies don’t usually lead to better jobs or lower prices. Cleveland-Cliffs already cut 1,200 jobs this year, blaming Trump-era tariffs that tanked auto demand. At the same time, Nippon’s literally offering bonuses and a billion-dollar revitalization plan. One side is trying to grow the pie. The other side wants to eat it, smash the plate, and fire the waiter.

As if things weren’t messy enough, hedge fund Ancora (aka Goncalves’ hype men) is launching a hostile takeover of U.S. Steel’s board, trying to stack it with people loyal to Cliffs (including one guy who just so happened to work at Stelco) which Cliffs conveniently bought last year.

What began as a straightforward business deal (one company buying another0 has now spiraled into a full-blown steel cage match featuring corporate lobbyists, union power plays, political backroom deals, and just enough international tension to keep things interesting.

And somehow, Trump’s now the referee. He's got to decide whether to champion free markets like a classic Reagan-era conservative or throw on a “Made in America” hard hat and hand the keys to whichever billionaire whispers “America First” the loudest.

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Stock.News has positions in Coca-Cola and Cleveland-Cliffs.