Nippon Steel invests 11 billion dollars: US Steel in new splendor!

Nippon Steel invests 11 billion dollars: US Steel in new splendor!

On August 28, 2025, Nippon Steel Corporation announced a significant $11 billion investment in United States Steel Corporation (U.S. Steel). The move is expected to increase the company's profit contributions to 250 billion yen ($1.70 billion) by 2028 while expanding production capacity. The takeover of U.S. Steel for $14.9 billion closed in June 2025 after taking 18 months due to various political changes in the US. The acquisition makes Nippon Steel the second largest steel manufacturer in the world.

The company plans a number of projects that will increase both U.S. and U.S. profitability. Steel and enable know-how transfer. These initiatives are expected to have a positive impact on the company not only through 2028, but potentially beyond that period as well. The planned measures include the construction of a new hot rolling mill at the Mon Valley Works in Pennsylvania and the modernization of blast furnace No. 14 at the Gary Works in Indiana. In addition, new electromagnetic steel sheet lines and capacity expansions are planned.

Expansion plans and investment strategy

Nippon Steel aims to expand U.S. domestic crude steel capacity Steel from 17 million tonnes to around 20 million tonnes. Nippon Steel's global annual crude steel capacity is expected to increase to 86 million tons, with a long-term goal of reaching 100 million tons.

A detailed investment plan will be published in 2025 as part of Nippon Steel's new medium-term business strategy. The company plans to raise 500 billion yen through a subordinated loan to partially repay a 2 trillion yen bridge loan. In addition, U.S. Steel will initially finance the investment itself, while Nippon Steel could step in if funds are insufficient.

Political controversies and challenges

The takeover of U.S. Steel was not without controversy. Critics, including the White House and the United Steelworkers (USW), expressed concerns about national security and the impact on jobs. While the Biden administration spoke against the takeover on March 14, 2024 and intervened with an executive order on January 3, 2025, there was still an agreement that secured a “golden share” for the US government. This allows the government to control key business decisions and investments.

The possibility of a bidding war for U.S. Steel was also an issue, with Cleveland-Cliffs and Nucor expressing interest following the government blockade. However, academic and economic perspectives suggest that Nippon Steel's investments have the potential to help U.S. Steel to revitalize, despite the existing challenges.

U.S. Steel, founded in 1901, had to close several plants over the years and was removed from the Dow Jones Industrial Average in 2001. The now completed acquisition and planned investments could be crucial for the future of the company and the US steel industry as the market adapts to the new realities.

the acquisition was completed on June 18, 2025, and Wikipedia adds that U.S. Steel, as a wholly owned subsidiary of Nippon Steel, will continue to maintain its name and headquarters in Pittsburgh, Pennsylvania. The company now faces the exciting challenge of positioning itself in a dynamic market environment.