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Trump holds rally at U.S. Steel plant in political swing

state

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President says he has not given final approval

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Trump has until next week to formally approve merger

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Tie-up with Japanese company has faced headwinds

(Adds deal still awaiting Trump's approval, paragraphs 4-5)

By Jeff Mason, Alexandra Alper and Trevor Hunnicutt

WEST MIFFLIN, Pennsylvania, May 30 (Reuters) - U.S.

President Donald Trump on Friday lauded an "agreement" between

Nippon Steel ( NISTF ) and U.S. Steel at a political rally

but stopped short of approving the companies' diplomatically

sensitive merger.

On a stage near Pittsburgh, Pennsylvania, decorated with

signs celebrating "American steel," Trump declared the American

steel company would remain American, while extolling its

prospective new Japanese partner.

"We're here today to celebrate a blockbuster agreement that

will ensure this storied American company stays an American

company," Trump told more than 1,600 people, including hard

hat-wearing workers. "You're going to stay an American company,

you know that, right? But we're going to have a great partner."

Later, though, he said the deal still needed his final

go-ahead, leaving unresolved whether he would allow Nippon Steel ( NISTF )

to take ownership, as they had proposed.

"I have to approve the final deal with Nippon, and we

haven't seen that final deal yet," Trump told reporters when he

returned from Pennsylvania.

The Japanese firm's planned acquisition of U.S. Steel,

initially floated in 2023, divided the politically important

state of Pennsylvania and its heavily unionized blue-collar

workforce. It also introduced tension into normally friendly

relations between Tokyo and Washington.

Proponents of the transaction had hoped Trump's visit would

end a tumultuous 18-month effort by Nippon Steel ( NISTF ) to buy

the iconic American company, beset by opposition from union

leadership and two national security reviews.

Trump's remarks on Friday shed little light on the contours

of a deal that he would approve or whether a formal green light

was in the offing.

He vowed to workers that U.S. Steel would be "controlled by

the USA," no layoffs would occur, and that Nippon would invest

billions of dollars to modernize U.S. steel mills to increase

production. He later suggested to reporters that the company's

board would be U.S.-"controlled."

The president also announced a plan, to be implemented on

Wednesday, to double tariffs on imported steel to 50%, from 25%.

"I have to tell you about Nippon, they kept asking me over

and I kept rejecting - no way," Trump said, adding "I'm going to

be watching over it."

The White House and the companies have not responded to

requests for comment on the status of deal talks.

Trump announced the rally and appeared to endorse the merger

last Friday in a social media post, sending U.S. Steel's share

price up over 20% as investors bet he would soon give it the

go-ahead.

On Sunday, he sowed doubt, describing the deal to reporters

not as the full takeover Nippon is seeking but as an investment

with "partial ownership."

U.S. Steel is headquartered near Pittsburgh, which

symbolized both the erstwhile strength and more recent decline

of U.S. manufacturing as the Rust Belt's steel plants and

factories lost business to international rivals. Trump won

closely contested Pennsylvania in 2024.

"We would not be here today without President Trump, who has

secured the company's future by approving our partnership," said

Nippon Vice-Chair Takahiro Mori, who spoke before Trump.

In a sign of the many open questions that remain, Japan's

top trade negotiator, Ryosei Akazawa, told reporters on Friday

he could not yet comment on the tie-up.

"I am aware of the various reports and posts by President

Trump on social media. However, there has not yet been an

official announcement from the U.S. government," Akazawa, in

Washington for tariff negotiations, said at a briefing at the

Japanese Embassy in Washington.

Trump technically has until Thursday to decide whether to

formally approve or scuttle the deal, after the Committee on

Foreign Investment in the U.S. last week completed a second

review of the merger. But the timeline could slip.

The road to Friday's rally has been a bumpy one.

Nippon Steel ( NISTF ) offered $14.9 billion for U.S. Steel in

December 2023, seeking to capitalize on an expected ramp-up in

steel purchases, thanks to a bipartisan infrastructure law.

But the tie-up faced headwinds from the start, with

then-President Joe Biden and Trump both asserting U.S. Steel

should remain American-owned as they sought to woo voters ahead

of November's election.

Following the previous review, Biden blocked the deal in

January on national security grounds. The companies sued,

arguing they did not receive a fair review process, a charge the

Biden White House disputed.

The steel giants saw a new opportunity in the Trump

administration, which opened a fresh 45-day national security

review into the proposed merger last month.

But Trump's public comments, ranging from welcoming a simple

"investment" in U.S. Steel by the Japanese firm to suggesting a

minority stake for Nippon Steel ( NISTF ), did little to shore up investor

confidence.

Reuters reported last week that Nippon Steel ( NISTF ) floated plans

to invest $14 billion in U.S. Steel's operations, including up

to $4 billion in a new steel mill if the deal wins Trump's

approval.