Cleveland-Cliffs CEO's Trump pandering
Add Axios as your preferred source to
see more of our stories on Google.
Illustration: Annelise Capossela/Axios
Imitation is the sincerest form of flattery, and flattery is one of the quickest ways to Donald Trump's heart.
Why it matters: That's the easiest way to understand what we saw yesterday from Cleveland-Cliffs CEO Lourenco Goncalves, who for nearly two hours spoke and took questions during a rambling press conference that veered from bravado to xenophobia to attacks on the press.
- At one point, he even grabbed an American flag and shouted "The United States of America!"
The big picture: Goncalves very much still wants to buy U.S. Steel, but would need Trump's help to do so.
- So he laid it on very, very thick.
Zoom in: The first thing Goncalves needs is for U.S. Steel's deal with Nippon Steel to be scrapped. That could happen if a court agrees with President Biden's block on national security grounds, in a case where oral arguments are likely to occur in early April.
- Even if U.S. Steel prevails, the deal would revert to a CFIUS controlled by Trump. At that point, Goncalves would hope for a similar action — likely with a bit more legal artifice.
Fast forward: Goncalves would then need help getting the deal past Trump's antitrust regulators, who may be more lax than Biden's but still no pushovers.
- Remember that antitrust is a major reason why U.S. Steel didn't pick Cleveland-Cliffs in the first place. Moreover, reports are that Cleveland-Cliffs would partner on its revised bid with Nucor, which means the country's top two steelmakers by volume would be purchasing No. 3.
- Goncalves at times sidestepped the antitrust questions, but at other times seemed to validate them, talking about how Cleveland-Cliffs has a monopoly on one type of domestic steel production and needs more consolidation on another in order to compete with foreign producers.
Reactions: It's not yet clear how the presser played at Mar-a-Lago, but U.S. Steel wasn't moved.
- "We are incredibly disappointed in the verbal attacks levied by Mr. Goncalves toward the outstanding local leadership across Pennsylvania, the many members of the USW who have supported the combination of U.S. Steel and Nippon Steel, and the people of Japan – a critical U.S. ally."
- Pennsylvania Gov. Josh Shapiro was more measured, but disputed Goncalves' claim that a Cleveland-Cliffs tie-up had his endorsement.
- You've also got to also wonder how this played in Ohio, given that Goncalves pledged to rename the combined company U.S. Steel and move its headquarters to Pittsburgh.
The bottom line: Goncalves knows what he's doing, even if it didn't look like it.
