Kamala Harris opposes Japanese Nippon Steel buying US Steel

There is one thing Joe Biden, Donald Trump and Kamala Harris agree on: US Steel must remain an American company. The promises of multi-million dollar investments Nationalism is always a powerful political weapon and, in the midst of the electoral campaign for the elections on November 5, the candidates are aiming for home. This Monday, Labor Day, Harris took advantage of a joint rally with the President of the United States in Pittsburgh (Pennsylvania) to join the political barricade against an operation with business sense approved by the vast majority of capital from US Steel itself.

“We will continue to strengthen America’s manufacturing sector. And in this regard, the president has mentioned to us, US Steel is a historic American company, and it is vital for our nation to maintain strong American steel companies. And I couldn’t agree more with President Biden: US Steel must remain American-owned and operated. I will always stand with steelworkers and all American workers,” he said at an event organized by unions on the occasion of Labor Day.

Nippon Steel reached an agreement in December last year to buy US Steel, a century-old company that represents, like few others, a past in which heavy industry had a huge weight in the American economy, which is now focused on services. The operation, worth 14.1 billion dollars, involved the payment of 55 dollars for each US Steel share. The proof that the market does not trust that it will go ahead is that the company’s shares are trading at around 38 dollars, even below where they were trading before Nippon Steel presented its offer.

Nippon Steel’s offer was clearly higher than the $35 offer from American firm Cleveland-Cliffs, which triggered the company’s sale. Cleveland-Cliffs She was willing to raise the offer to $40, but the Japanese proposal was far superior.

The transaction was unanimously approved by the boards of directors of both companies. At the US Steel shareholders meeting, support was 98%. The companies have announced that the buyer would honour all of US Steel’s commitments to its employees, including all existing collective agreements with their unions, but have failed to win over their workers. Nippon Steel last week pledged multi-million dollar investments to try to overcome political and labour resistance, but to no avail.

“US Steel has been an iconic American company for more than a century, and it is vital that it remains domestically owned and operated,” Biden said earlier this month. The president went to the headquarters of the metalworkers’ union in Pittsburgh to express his opposition to the sale. The operation requires the approval of the Committee on Foreign Investment in the United States (CFIUS), which is part of the Treasury Department. It has the power to approve, block or modify the agreement for national security reasons, or refer it to the president for a decision. On Monday, Biden also reiterated his opposition at the same campaign event in which Harris participated.

Nippon Steel pledged to have US Steel invest $1.4 billion additional to its own solo plan as there would be no layoffs or plant closures until September 2026 under certain conditions. In addition to that figure, last week it added $1 billion to upgrade the hot rolling mill at the Irvin plant in the Pittsburgh area and other Mon Valley Works facilities in Pennsylvania; and approximately $300 million to upgrade one of the blast furnaces at the Gary Works in Gary, Indiana. In addition, Nippon Steel said it continues to see numerous opportunities for technology transfer to the U.S. firm following the close of the transaction to reduce the environmental footprint and extend the longevity of its represented facilities.

The Japanese company has also hired Mike Pompeo, Trump’s former secretary of state, to try to overcome resistance to the operation. So far, Nippon Steel has had no success in its efforts. It remains to be seen whether opposition to the operation will remain as strong after the elections.

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