The United Steelworkers union is resisting Nippon Steel’s proposed $14.1 billion acquisition of US Steel.
The transaction focuses on the company’s Mon Valley Works mill, an aging industrial complex near Pittsburgh.
This site has been hit by a fire and heavy regulatory penalties.
It symbolizes the broader challenges facing the 123-year-old US Steel amid potential closure speculations.
US Steel’s shareholders are set to vote on the pending deal.
Unionized workers have voiced concerns about the future of the company’s production facilities in the region, historically known as America’s Steel City.
The union’s discontent stems from a halted $1.2 billion upgrade plan for Mon Valley and US Steel’s decision to bolster production at a nonunion facility in Arkansas, which union leaders interpret as a neglect of its longstanding plants.
Nippon Steel has tried to propose a $1.4 billion investment to revitalize US Steel’s aging mills and ensure no layoffs or plant closures until at least 2026.
Don Furko, president of the union local for US Steel’s coking coal plant for Mon Valley, said: “I don’t believe it. Prove it.
“They would have to give us some details about what they plan on doing.”
Union members, including Don Furko of the local coking coal plant, remain skeptical, demanding concrete plans and commitments from Nippon Steel.
There are bipartisan legislative calls to stop the deal.
This is partly fueled by President Biden’s preference for keeping US Steel under domestic ownership.
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National Security Concerns
Given Nippon Steel’s business ties in China, national security considerations underpin this stance.
The transaction is currently under a national security review by the US Treasury Department’s Committee on Foreign Investment.
Cleveland-Cliffs, a rival steelmaker with previous acquisition interests in US Steel, is also lobbying against the Nippon Steel transaction.
An agreement between Nippon Steel and the United Steelworkers could dissolve much of the existing opposition, contingent on Nippon Steel convincing the union of its commitment to a prosperous future for US Steel and its workforce.
US Steel’s environmental and labor relations record, especially at Mon Valley, adds another layer of scrutiny to the deal.
