One and a half months have passed since the Osaka-Kansai Japan Expo opened on April 13. Measures against various troubles in the early phase have been taken, and the number of visitors has been increasing gradually. The number of visitors continues to exceed 100,000 even on weekdays after mid-May, and on May 23, it was 139,000, surpassing the opening day’s figure of 124,000 for the first time. However, during the six months until October 13, on the premise that expected number of visitors is 28.2 million, the daily average will be 150,000. It is said that further measures to cope with the complaints or puzzlement about the congestion that still occurs are necessary.
Next, three “Well done!” to the Japanese athletes for their outstanding performances in their sports.
1)Ozeki Onosato won the Summer Sumo Tournament on May 25, Sunday, marking his fourth victory in two consecutive tournaments, and officially became “the 75th Yokozuna”. The promotion achieved after 13 tournaments from the debut is the fastest in history after 1958 when the system of six tournaments a year was established. And the last time Yokozuna were lined up from east to west was the Autumn Sumo Tournament in 2021. He was born in Ishikawa prefecture, and he brought a bright topic to his hometown which has been plagued by a series of major disasters and many dark news lately and he has truly returned home loaded with honors. Well done!
2)The duo of Shinozuka and Togami won the men’s doubles final against the Taiwanese duo at the World Table Tennis Championships held in Lusail in the suburbs of Doha, capital of Qatar, and they achieved first victory. The last time Japan won the gold medal in this event was 1961, and it is the greatest achievement in 64 years. Well done!
3)Proactive challenge in LPGA (Ladies Professional Golf Association in the United States) tournaments by Japanese women’s professional golfers and their power are becoming a hot topic. Mao Saigo, who is in her second year participating in the U.S. tour, secured her first LPGA major title at the Chevron Championship, the first women’s major championship this year, held at The Club at Carlton Woods in Texas at the end of April. Followed by this, Chisato Iwai won her first LPGA title in Riviera Maya Open, Mexico. With this, there are now three Japanese women champions in LPGA tournament this year and it is a record high. It seems that Japanese women are better at adapting to different cultures or more adaptable than Japanese men. Well done!

■■Notice:
As I told you in the last blog, I am planning to go to Europe from June 5 (Thursday) to 15 (Sunday). I will stream from Barcelona, Spain on June13 (Friday), the next scheduled stream date, on the premise that I can access the internet.

■■What I have recently thought and focused on:
■Nippon Steel’s bid to acquire U.S. Steel:
When I opened the morning newspaper on May 25 (Sunday), large headlines regarding the title jumped out at me from the front page. Titles of major newspapers were as follows. ①The Nikkei Shimbun-“Reversing course to approve the acquisition of U.S. Steel and evaluating Nippon Steel’s 2 trillion yen investment” ②The Yomiuri Shimbun-“Nippon Steel’s bid to acquire U.S. Steel, softening due to increased investment. Mr. Trump’s practical choices. Nippon Steel acquisition plan to be approved.” ③The Asahi Shimbun-“U.S. Steel ‘partnership’ was approved. Nippon Steel moving forward with acquisition.” The Asahi Shimbun used somewhat cautious terminology, but other newspapers gave the impression of strong expectations for the “acquisition” by Nippon Steel. Perhaps due to that influence, Nippon Steel’s stock price rose the next day. The background of this report was that President Trump made a statement on the day before that “he approved planned partnership between Nippon Steel and U.S. Steel”.
When I looked at the reports from each newspaper, I felt intuitively that “this was a bit of a jump to conclusions” or “this might be a sign of excessive expectations for the success of the acquisition”. It is said that Mr. Trump will hold a meeting in Pittsburgh, Pennsylvania and express his formal opinion on May 30 in local time, but it seems to me that currently, things are not going as planned for Nippon Steel. Hoping that “it will end in needless worry”, I would like to give my opinion on “why mutual misunderstanding occurred”.
Nippon Steel announced in December 2023 that “they want to acquire U.S. Steel for $14.1 billion equivalent to about 2.01 trillion yen and make it a wholly owned subsidiary”. At that time, there was a fierce election campaign leading up to the presidential election in November 2024. Both of them aimed to develop transactions on a purely private basis, but due to various unwanted ties, United Steelworkers (USW) expressed disapproval and things was getting complicated. This was a big miscalculation for Nippon Steel. USW has about 0.85 million members and the headquarter is located in Pittsburgh where U.S. Steel is headquartered. On top of that, Pennsylvania is one of battleground states that will determine the outcome of the presidential election. Therefore, it became a politicized issue over the contest for union votes.
Mr. Trump, the Republican presidential candidate at that time, announced without delay in January 2024 that “he would immediately stop it”, and in response to this, President Biden also took an “opposing” stance. After that, this escalated into a legal battle as “political interference in a private business transaction”.
And the Japan-U.S. summit was held on February 7, after Mr. Trump was inaugurated as president, and at that meeting, he described the Nippon Steel deal as “an investment, not an acquisition”. In other words, “investment and contributions are permitted but ownership is not handed over”. And according to the reports, Prime Minister Ishiba also agreed with this. President Trump is taking “the agreement” at this time as a premise afterwards.
On the other hand, from the start of the acquisition negotiations, Nippon Steel side has consistently maintained that the prior condition is that U.S. Steel “becomes “a wholly owned subsidiary”. There is a decisive gap here with President Trump. On top of that, Nippon Steel side is pinning its hopes on that President Trump stated that “he will meet with Nippon Steel top executives” and he instructed the Committee on Foreign Investment in the United States, CFIUS, to conduct a review in April this year. In order to encourage him to change his mind, conditional on approval of “the 100% acquisition”, Nippon Steel side has offered to invest an additional $14 billion (about 2 trillion yen) in U.S. Steel’s production facilities.
On the other hand, President Trump perceives this proposal purely as part of “investment”, and he is boasting about it as his own achievement or success of the deal. And it seems that he thought this method would also convince USW. At present, it seems that a mixed solution, in other words, while accepting Nippon Steel’s wishes “to some extent”, the U.S. government is granted “the golden share”, veto power over important management decisions, is being sought. However, this is a separation from the most important aspect of Nippon Steel’s “wholly owned subsidiary (management rights)”, and it is hard to deny that it gives the impression of “skimming the cream”.
Where did mutual misunderstanding originate? The biggest factors are that Nippon Steel’s top executives’ hopes for a meeting with President Trump did not materialize and it is speculated that CFIUS did not adequately convey Nippon Steel’s true intentions (the prior condition is to become “a wholly owned subsidiary”) to President Trump.
Then, what will happen from now on? No matter how changeable President Trump is, it will be difficult to completely change his traditional thinking. On the other hand, if Nippon Steel side can’t secure “ownership through the acquisition”, can they back out of this deal and “say things are different”? Considering the fact that the leaders of Japan and the United States agreed on “investment” at the Japan-U.S. summit and political and economic impact on Japan-U.S. relations, that is a difficult thing to achieve in reality. However, the acquisition capital $14.1 billion and the additional investment in facilities of $14 billion, about 4 trillion yen in total, will be a significant risk for Nippon Steel. It will be interesting to see how Nippon Steel management judges.