U.S. Steel shareholders approve Nippon deal; USW responds
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Shareholders of Pittsburgh-based U.S. Steel have overwhelmingly approved the proposed $14.1 billion sale to Japan-based Nippon Steel, the steelmaker announced Friday.
More than 98% of the shares voted in favor of the controversial deal at a special meeting of stockholders, according to a preliminary vote count.
The proposed acquisition was first announced in December and, if completed, would create a company that would be among the top three steel producers in the world, according to 2022 figures from the World Steel Association.
U.S. Steel CEO David Burritt said in a statement after the vote that the support from shareholders is an “important milestone” as the companies progress toward completing the deal.
“This transaction truly represents the best path forward for all of U. S. Steel’s stakeholders—union and non-union employees, customers, communities and stockholders—and for the United States and our home in Pennsylvania,” Burritt said. “By creating the best steelmaker in the world, we will have a stronger company to sustain our talented employees and fulfill all commitments to them, including all of the obligations under the agreements in place with our unions.”
The deal has drawn scrutiny from lawmakers and the Biden administration on economic and national security grounds. Last month, President Biden said, “It is vital for [U.S. Steel] to remain an American steel company that is domestically owned and operated.”
Japanese Prime Minister Fumio Kishida said on Wednesday during a White House news conference that he hopes discussions on Nippon “will unfold in directions that would be positive for both sides.”
The United Steelworkers Union issued the following statement after the voting results were announced:
“We are not surprised by stockholders electing to cash in and sell out the iconic American company’s employees and retirees, along with the communities where we live and work.
Wall Street investors and U.S. Steel executives obviously stand to gain the most from Nippon and its $15 billion while leaving union members in the cold. After all, CEO David Burritt reportedly stands to personally make more than $70 million from the deal, with his cabal of vice presidents raking in tens of millions of dollars—each.
Thankfully, today’s vote isn’t the end of the story: The decision ultimately isn’t simply up to shareholders and executives. Lawmakers from both parties, government agencies, regulators and the president of the United States have all raised concerns and promised a thorough investigation of the deal.
Our contract also provides security for our jobs, earnings and benefits. We must remain united as we fight to enforce it. U.S. Steel would have no value if not for the hard work of generations of USW members to build the company into what it is now.”
In January, the union filed grievances alleging U.S. Steel violated its contract with the union when it entered into an agreement to be acquired by Nippon.
U.S. Steel founded the city of Gary in Indiana with its Gary Works operation that at one time employed some 30,000 people. The steelmaker also operates the Midwest Plant in Portage.
U.S. Steel said it will disclose the final, certified voting results with the U.S. Securities and Exchange Commission when they are available.