Trump Allies Lobby for Nippon Takeover of US Steel
Even as Trump says he’d block the merger, his previous and current campaigns have no shortage of ties to the Japanese steel giant.
By Donald Shaw and David Moore, Sludge
Former President Donald Trump’s largest known campaign bundler, one of his 2016 campaign’s largest fundraisers, a former special assistant, and a nonprofit chaired by his chief pollster are all lobbying for a massive steel industry merger that Trump says he opposes.
Nippon Steel, the Japanese steel giant, is trying to purchase Pittsburgh, Pennsylvania-based United States Steel for $14.9 billion. Since February, Trump has been saying he would block the proposed merger if he retakes the White House next year, making the promise most recently at an August 19 campaign rally in York, Pennsylvania.
President Joe Biden has also said that he opposes the deal, as does Vice President Kamala Harris, but the administration approved Nippon Steel’s request last week to resubmit its filings and extend the process. The move gives Nippon Steel three more months to push federal officials on the deal and shifts the final decision until after the November elections, according to the New York Times.
On August 31, the Biden administration sent a letter to Nippon Steel saying that the Committee on Foreign Investment in the United States, an inter-agency group that approves transactions in light of national security, warned that the proposed deal threatens the supply chain for critical U.S. industries and harms competition.
U.S. Steel became an acquisition target last year when its shares were seen as undervalued compared to the competition, as a result of needed upgrades to its blast furnaces and slowdowns in auto manufacturing. For Nippon Steel, the deal provides a valuable opportunity to consolidate power in the steel market and expand its global reach, while workers represented by the United Steelworkers union are concerned that Nippon would seek to renegotiate their existing contract, which expires in September 2026, and could pursue layoffs and plant closures.
In addition, the Department of Justice opened an antitrust investigation into the proposed acquisition in April, centering around U.S. Steel’s position as a competitor to an Alabama manufacturing plant that is jointly owned by Nippon Steel and the world’s second-largest steel producer, the Luxembourg-based ArcelorMittal.
U.S. Steel CEO David Burritt said on Tuesday that he was confident the deal would go through despite opposition from Biden, Trump, Harris, and labor unions. “I know it's getting scrutiny, but this deal will close on its merits,” Burritt said in a speech this week at the Detroit Economic Club. “We live by a code and expect others to do the same.”
Ties to Trump confidantes
After Trump first spoke out against the deal in February, Nippon Steel hired the Trump-connected Ballard Partners lobbying firm to help it push policymakers in D.C. on the deal. Nippon hired the firm in late April, according to a disclosure, and among the lobbyists on the account is firm President Brian Ballard, a former Florida lobbyist for the Trump Organization who was a fundraiser for the former president’s 2016 campaign, the vice chairman of Trump’s inaugural committee, and a member of the Trump presidential transition finance committee.
Another Ballard Partners lobbyist who is promoting the merger for Nippon Steel is Hunter Morgen, a former special assistant to Trump. Morgen, who was appointed by Trump in 2018 as special assistant to the president and policy specialist for the Office of the Senior Advisor for Policy, was the first former Trump administration official to spin through Ballard’s revolving door when he joined the firm in February 2020.
Ballard’s ties to Trump have been seen as so valuable that within two years of setting up the Ballard Partners shop in D.C. in 2017, the firm had more than a hundred lobbying clients.
Also lobbying in favor of Nippon Steel’s acquisition of U.S. Steel this year was the Center for Individual Freedom, a nonprofit conservative advocacy group. The organization’s board chair is Tony Fabrizio, a Republican pollster and strategist who is the Trump 2024 campaign’s chief pollster. Fabrizio had been working for the pro-Trump super PAC MAGA Inc, but in April, he was brought into the campaign so he would be allowed under campaign finance laws to communicate directly with Trump and his staff.
The Center for Individual Freedom’s lobbying disclosure for the first quarter of 2024 includes “correspondence with the United States Department of Treasury in opposition to any Biden Administration effort to interfere in the proposed acquisition of U.S. Steel by Nippon Steel, research relating thereto.”
Another lobbyist that Nippon Steel hired this year to push the federal government on the merger is Geoff Verhoff, the Trump campaign’s largest known bundler and a senior adviser at the public affairs firm Akin Gump Strauss Hauer & Feld. Verhoff has raised more than $3.6 million this year for the Trump 47 Committee, according to Federal Election Commission filings.
Nippon Steel hired its first U.S. lobbyists in December 2023 and spent more than $1 million on lobbying in the first half of this year. U.S. Steel has also bulked up its lobbying operations to promote the deal and is on course to spend about $4 million this year, four times as much as it spent last year. The company also hired several lobbyists who are closely tied to the Democratic Party, including but not limited to Senate Majority Leader Chuck Schumer’s former chief counsel Reggie Babin, former U.S. Democratic Rep. Filemon Vela, and Richard Coppola, the former chief of staff to former congressman and top Biden adviser Cedric Richmond.
In addition to lobbying, both companies have spent big on ad campaigns promoting the merger including roadside billboards, Washington D.C. bus stop placards, TV commercials, printed mailers, and web ads on political news sites like Politico.
“Since December, U.S. Steel and Nippon have spent tens of millions of dollars to pay lobbyists and countless more to blanket the airwaves with slick ads filled with empty promises,” said United Steelworkers International President David McCall. “It’s clear why U.S. Steel CEO David Burritt and his fellow executives are so desperate to save the deal: Burritt’s $70 million dollar change in control bonus and the millions of dollars other top USS executives stand to personally gain.”
Politically-connected PR
Alongside its lobbying, Nippon Steel has hired politically connected public relations firm Teneo to support it throughout the acquisition process.
Teneo, which has worked for a wide range of Fortune 100 companies as well as foreign governments like Saudi Arabia and the United Arab Emirates, acquired a majority stake in the Biden White House-tied consulting firm WestExec Advisors in August 2022. WestExec Advisors was founded by Biden’s Secretary of State Anthony Blinken, and several of its former employees have joined the Biden administration including Director of National Intelligence Avril Haines, Deputy CIA Director David Cohen, and Deputy Attorney General Lisa Monaco.
Teneo has also been mentioned in news reports for its work for clients including former Uber CEO Travis Kalanick, crypto hedge fund Three Arrows, financial services company HSBC, and fossil fuel companies Chevron and Occidental.
Teneo CEO Paul Keary was a witness at a February Senate hearing investigating foreign influence and the work of consulting companies, also including McKinsey and Boston Consulting Group, for clients like the Saudi government. Teneo has earned tens of millions of dollars since the start of 2021 for its Foreign Agents Registration Act work, representing enterprises such as Neom, the urban megaproject in Saudi Arabia that has drawn scrutiny, including from United Nations special rapporteurs, for alleged human rights abuses.
Teneo has several former members of Congress on its staff and board. Former House Speaker Paul Ryan (R-Wis.) is a Teneo vice chair, while former U.S. Sens. Chris Dodd (D-Conn.) and U.S. Sen. George Mitchell (D-Maine), the latter a former Senate majority leader, are senior advisers. Teneo co-founder and former president Doug Band was also a key adviser to President Bill Clinton who later helped the former President start the Clinton Foundation and Clinton Global Initiative, and even pushed Teneo clients to make donations to the foundation.
Representing U.S. Steel in the deal is PR firm Joele Frank, whose website touts that it is the top-hired consultant since 2019 for corporations in defending against shareholder activism. The firm’s work on the proposed acquisition is led by partners Ed Trissel, a strategic communications consultant for U.S. and international companies who often provides counsel to private equity firms, and Kelly Sullivan, who the firm says often advises companies facing activist shareholders.
Additionally, the trade association Autos Drive America is lobbying in “strong support” for the merger with Congress, the U.S. Trade Representative, the Commerce Department, and other offices. The group represents international automakers including Honda, Toyota, and Volkswagen. The association’s president and CEO, Jennifer Safavian, a former staff director and general counsel for the House Ways and Means Committee, is one of the lobbyists mentioned discussing the topic in the second quarter of this year.
In a June memo to union members, McCall described his many concerns with Nippon’s proposed takeover, including uncertainty around future contracts and the challenges the union could face in accessing the company’s financial information if it is no longer publicly traded. McCall also shed doubt on Nippon’s claims that it would invest in upgrades for the company, and said that failing to do so would hurt the company’s ability to produce steel from raw materials and help Nippon make the U.S. more reliant on imported materials. He also laid much of the blame for U.S. Steel’s willingness to sell on the CEO himself.
“Our union and our political leaders must continue to hold Burritt accountable for his reckless, self-interested management,” McCall said. “Together, we will continue to fight to protect the long-term security of our members, communities and national security rather than let Burritt treat them like his personal piggy bank.”