Union president praises block of U.S. Steel sale; Gary mayor ‘disappointed’
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The president of the United Steelworkers union says President Joe Biden’s decision on Friday to block Nippon Steel’s proposed $14.9 billion acquisition of U.S. Steel was the “right move for our members and for America’s national security.”
Meanwhile, Gary Mayor Eddie Melton expressed his disappointment in the move, saying it creates uncertainty for employees at the steelmaker’s Gary Works operation.
Biden’s decision came after the Committee on Foreign Investment in the United States, known as CFIUS, failed to reach consensus on the possible national security risks of the deal last month. It was also in line with the president’s vow in early 2023 to block the deal.
During a virtual news conference Friday, USW President David McCall said the union’s first and only concern has been the long-term viability of its facilities and member jobs.
“I met with Nippon Steel’s leadership on various occasions, and as recently as three weeks ago, what has been clear throughout this is that while a deal would have been a huge windfall for U.S. Steel’s investors, its management, leadership, the deal advisors, it threatened the long term security of our members,” McCall said.
On the opposite side, Mayor Melton has been vocal with his support of the Nippon acquisition, even appearing at a news conference in Gary last month with Nippon Vice Chairman Takahiro Mori.
In a statement to Inside INdiana Business, Melton said he believes the deal was best on the table for steelmaking families in cities like Gary.
“Yesterday, we had a guaranteed deal in hand,” Melton said. “The potential sale of U.S. Steel to Nippon Steel represented a significant opportunity for Gary and the American steel industry to grow and prosper. Now, we face an uncertain future, with Gary Works potentially losing investment and jobs.”
Both Nippon Steel and U.S. Steel said in a joint statement Friday that it’s “shocking — and deeply troubling” that the U.S. would reject a transaction that advances U.S. interests and “treat an ally like Japan in this way.”
“Unfortunately, it sends a chilling message to any company based in a U.S. allied country contemplating significant investment in the United States,” the companies said.
When asked about a possible court fight over Biden’s move, McCall said, “I guess anybody can sue anybody in this country,” but added that the president and CFIUS have aligned with the union in its concerns over protecting jobs and national security.
McCall called on U.S. Steel to move forward and put its focus on the companies facilities in Indiana and elsewhere.
“It’s clear from “U.S. Steel’s recent financial performance that it can easily remain a strong and resilient company,” McCall said. “U.S. Steel’s board of directors needs to evaluate the interest of all stakeholders as it looks to the future, and we encourage it to take the necessary steps to allow us steel to further succeed and remain profitable.”
The Associated Press contributed to this report.