Northwest Indiana anxious about outcome of U.S. Steel/Nippon deal
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As a subscriber you can listen to articles at work, in the car, or while you work out. Subscribe NowAcross the northwest Indiana region, anxiety is running high on the outcome of Nippon Steel’s proposed $15 billion acquisition of U.S. Steel.
Last week, the Biden administration issued an order blocking the deal, citing national security concerns.
Two days later, both companies were in federal court, seeking to have the order thrown out.
U.S. Steel founded Gary in 1906, and today Gary remains home to the largest integrated steel mill in the northern hemisphere.
In an interview with Inside INdiana Business last week, Gary Mayor Eddie Melton said he wants to see the deal happen as well as investment in the plant and job growth.
“In a perfect world, the plan that I’m putting in place now—in the next four and a half to eight years, Gary will be the greatest comeback story in American history,” Melton said. “We’re really poised and positioned to move forward and having a deal like this would expedite that and it will reassure that success.”
U.S. Steel is the area’s largest employer with more than 4,000 workers. Nippon has several subsidiaries in Indiana, including Nippon Steel Pipe America in Seymour, Suzuki Garphyttan Corp. in South Bend, and Nippon Steel & Sumikin in Shelbyville.
Joseph Pete, a business reporter at IIB newsgathering partner The Times of Northwest Indiana, says the region is experiencing a lot of uncertainty about what happens next.
“Initially there was shock about the possibility of U.S. Steel getting bought out, because they’ve been such a bedrock institution in northwest Indiana for so long. They founded Gary as a company town, they’ve been a major employer for years [and] they’ve just been very weaved into the fabric of the community,” Pete said. “There’s a lot of division and uncertainty…people are just kind of taking a wait and see approach to finding out what’s going to happen.”
Pete says steel is central to the region’s identity and that many jobs pay six figures with overtime.
“It supports so many different jobs in so many areas. There’s such a network of smaller companies that basically feed off of the steel mills,” Pete said. “It’s been said everybody at one point either knew a family member or a friend who was working in one of the mills.”
Melton says he was skeptical at first but has done research and met with leaders to learn and share concerns.
“Myself and the CEO of U.S. Steel, we never met, we never talked, and now we are talking almost every every week. We’ve built a rapport and relationship that regardless of the outcome, which I still hope is going to be positive. I think we’re on the right track to revitalize this relationship and figure out how we can grow.”
While administration officials have said the decision was unrelated to Japan’s relationship with the U.S., this is the first time a U.S. president has blocked a merger between a U.S. and Japanese firm.
Nippon Steel has promised to invest nearly $1 billion in Gary Works if the deal is completed, with the prospect of new jobs.
U.S. Steel CEO David Burrett has suggested some plants may close if the deal falls apart.