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Japanese takeover could spell long-term decline of U.S. Steel, union chief says
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Japanese takeover could spell long-term decline of U.S. Steel, union chief says
Dec 10, 2024 7:06 PM

*

Head of union opposing U.S. Steel sale unconvinced of

long-term

viability

*

Fears Nippon will import steel into U.S. from

international

mills

*

Nippon trying to close deal before Donald Trump takes

office

(Adds White House comments and U.S. Steel share price moves in

paragraph 3, U.S. Steel comment in paragraph 12)

By John Geddie

Dec 11 (Reuters) - The head of a powerful labour union

opposing U.S. Steel's sale to Japan's Nippon Steel ( NISTF )

said he has not received assurances that the would-be

owners are committed to ensuring the lasting success of the

strategic U.S. firm.

Nippon Steel's ( NISTF ) $15 billion takeover bid has been criticised

by both President Joe Biden and President-elect Donald Trump and

is subject to a national security review by the secretive

government panel CFIUS which is due later this month.

The White House on Tuesday said Biden will wait for the

outcome of the review before deciding on whether to block it

after U.S. Steel's shares tumbled on a report suggesting he was

poised to kill the deal.

David McCall, the head of the United Steelworkers union,

told Reuters on Monday that one his top concerns is that Nippon

may import steel into the U.S. from its international mills, a

move he worries would erode a company that helped build the

Empire State Building and arm allied forces in World War Two.

"When we've had discussions with them there's been nothing

that would assure us that there's a long-term viability in the

operations," McCall told Reuters via video call from his office

in Pittsburgh, Pennsylvania.

"They (Nippon Steel ( NISTF )) want a return on that investment and I

understand that but it can't be harvesting our facilities and

letting them slowly but surely over a period of time deteriorate

so that they can then bring product in from their other

facilities around the world and have access to our market."

Nippon Steel ( NISTF ) has previously denied it will use the deal as

cover to import steel and has made a series of pledges to

protect jobs and invest in U.S. facilities it sees as key to its

future growth.

Nippon Steel ( NISTF ) declined to comment further on McCall's

comments.

The union leader also criticised the Japanese suitors for

not trying to stop or intervene in what he called "bullying"

from U.S. Steel CEO David Burritt to close the deal.

Burritt told the Wall Street Journal in September that the

firm would close steel mills and likely move its headquarters

out of Pittsburgh if the sale failed.

"He's like a schoolyard bully demanding your lunch money,"

he said of Burritt, adding the threats had "scared the hell" out

of some of his members.

In emailed comments, U.S. Steel said the Japanese bid was

the "only realistic transaction" and one that would increase

investment in blast furnace facilities.

Nippon Steel ( NISTF ) is racing to close the deal before Trump - who

has vowed to block the transaction - takes office on Jan. 20.

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