Melton joins PA mayors in letter of support for U.S. Steel acquisition
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Gary Mayor Eddie Melton is one of 20 mayors—the rest from western Pennsylvania—that signed a letter of support for Nippon Steel’s proposed $14.9 billion acquisition of Pittsburgh-based U.S. Steel.
The letter to President Joe Biden also outlined “deep concern” over opposition from the leadership of the United Steelworkers union.
The mayors sent the letter on Dec. 23, the same day that the Committee on Foreign Investment in the United States, or CFIUS, which failed to reach consensus on the possible national security risks of the deal in its long-awaited report to the president.
“Our communities in the Mon Valley of Pennsylvania as well as Gary, Indiana are made up of working-class American men and women whose identity and livelihood depend on the success of U. S. Steel,” Melton and the mayors said in the letter. “As such, they overwhelmingly support the vision and commitments that Nippon Steel has introduced to ensure that their jobs are protected and that their local facilities stay open.”
Earlier this month, the Japanese steelmaker said it would invest $1 billion in U.S. Steel’s Gary Works if the acquisition goes through. That includes a previously announced $300 million commitment to revamp the Blast Furnace #14 at the company’s flagship steel mill.
“We at Nippon Steel believe that this partnership will be the beginning of a bright new future at U.S. Steel,” Nippon Steel Vice Chairman Takahiro Mori said at a Dec. 12 news conference alongside Melton. “It is by all measures, the path that minimizes uncertainty, maximizes investment, and delivers very real shared success to the people.”
In their letter to the president, the mayors questioned United Steelworkers leadership, saying it is “not acting in the best interests of its members.” The mayors said they asked USW President David McCall to come back to the negotiating table last week.
“To be frank, his actions were shocking,” the letter reads. “He would not engage in good faith, even though Nippon Steel provided a new agreement that addressed each of the concerns that USW leadership had raised with us. McCall announced that he would rather ‘see what happens’ instead of working to secure a deal for his members. As a final insult, he directed the USW to publish a press release saying that the meetings yielded no progress while we were all still in the room trying to reach a resolution.”
In a statement on Dec. 24, McCall and USW District 7 Director Mike Millsap continued their opposition to the deal, including the scrutiny over Nippon’s proposed $2.7 billion investments in U.S. Steel’s operations, including Gary Works.
“Nippon’s public relations machine talks about the $2.7 billion it said it could spend on our facilities,” McCall and Millsap said. “This was no doubt meant to impress outside observers who are unfamiliar with steelmaking, but looking more closely at the numbers and the actual words of Nippon’s commitment, the P.R. simply does not represent a significant investment in our future.”
The union leaders say Nippon aims to move steel production to smaller facilities, putting operations in Gary and Mon Valley, Pennsylvania in jeopardy.
“The unfortunate truth is that President McCall has lost support of rank-and-file members because of his refusal to negotiate in good faith on this transaction,” Melton and the other mayors said in their letter. “Each of us believes deeply in the importance of union labor, but USW leadership is currently playing games at a time when they should be listening to and acting on behalf of their members.”
Biden has previously expressed its opposition to the proposed acquisition. He has 15 days from receiving the CFIUS report to reach a final decision on whether to block the deal, according to the White House.
The Associated Press contributed to this report.