President-elect Donald Trump confirmed his intention to block the purchase of US Steel by Japanese steel company Nippon Steel Corp. He also pledged to use tax incentives and tariffs to boost the famous American steelmaker.
Trump had pledged early in the presidential campaign that he would block the deal “immediately,” and he repeated that sentiment in a post on his platform, Truth Social, on Monday evening.
“I am against the purchase of the once great and powerful American Steel Corporation by a foreign company” and I will use tax incentives and tariffs to make the American Steel Corporation “strong and great again, and it will happen quickly!” books.
He continued: “As president, I will prevent this deal from happening.” Buyer beware!!!
President Joe Biden, like Trump, also opposes Nippon Steel’s purchase of Pittsburgh-based US Steel. The Biden White House said in September that it had not yet seen a report from the secretive Committee on Foreign Investment in the United States, which was reviewing the deal for national security concerns. The committee, which is chaired by the Treasury Secretary and includes other Cabinet members, can recommend that the president block the deal, and federal law gives the president that power.
Before the November election, the proposed merger had political significance in Pennsylvania, a critical swing state that Trump ultimately won. Biden has publicly sided with the United Steelworkers union as he seeks to reject the deal.
When he announced his opposition in a statement in March, Biden said: “US Steel has been an iconic American steel company for more than a century, and it is imperative that it remains a domestically owned and operated American steel company.”
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Nippon Steel said it is the only company that can make the necessary investment in US Steel’s plants and boost the US steel industry. Nippon Steel and US Steel on Tuesday issued statements in support of the acquisition.
“This transaction must be approved on the merits. The benefits are very clear. Our communities, customers, investors and employees strongly support this transaction, and we will continue to defend it and adhere to the rule of law,” US Steel said.
The deal comes on the heels of a long series of protectionist US tariffs that analysts say have helped revitalize domestic steel, including US Steel. US Steel shareholders approved the deal, but the United Steelworkers opposed it.
In a statement issued on Tuesday, the union said the deal had “serious long-term implications for the economy and national security of the United States.”
“It is clear that President Trump understands the vital role that a strong domestic steel industry plays in our national security, as well as the importance of the jobs and communities the industry supports,” the union said.
The deal has drawn bipartisan opposition in the US Senate, including from the incoming vice president, Republican Senator J.D. Vance of Ohio, although the federal government’s objections to the deal have drawn criticism that the opposition is political.
Some U.S. steelworkers prefer that Nippon Steel acquire the company, since it appears to have a better financial balance sheet than another potential buyer, Cleveland-Cliffs.
U.S. Steel “has provided a very good life for our families for many years,” said Jack Maskell, vice president of the local chapter of the Steelworkers in West Mifflin, Pennsylvania. “We feel that with the Nippon Deal, many more families in the future will be able to share the same.”
West Mifflin Mayor Chris Kelly said he met with Nippon Steel executives and found himself satisfied with their commitments. Located southeast of Pittsburgh, West Mifflin is home to US Steel’s Mon Valley Works-Irvin plant.
“There’s no doubt in my mind that this is the best deal going forward,” Kelly said at a session hosted by the Hudson Institute, a conservative think tank, where Maskell was also speaking.
Trump’s statement came two weeks after Nippon Steel Vice President Takahiro Mori visited Pittsburgh and Washington to meet with lawmakers, local officials and workers in an ongoing persuasion campaign.
That campaign included Nippon Steel’s promises to increase its capital commitments beyond the original agreement and, more recently, a pledge that it would not import steel sheets that would compete with US Steel’s blast furnaces.
As part of its proposed $14.9 billion purchase of US Steel, Nippon Steel also pledged to invest at least $1.4 billion in facilities represented by USW, not conduct layoffs or plant closures during the term of the basic labor agreement, and protect their best interests. of American Steel in business matters.
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