According to a report by Nikkei on Monday, U.S. Steel, a leading force in the American steel industry, has issued a stark warning about the repercussions if its potential acquisition by Nippon Steel falls through.
The company argues that without the deal, the U.S. steel sector will be ill-prepared to counter China’s growing influence in the global market. This strong statement comes at a pivotal time, with President Joe Biden’s decision on the acquisition fast approaching.
U.S. Steel is intensifying its push for the deal’s approval, emphasizing the significant domestic investment and job creation it would bring.
In an official statement, the company described the Nippon Steel acquisition as the only viable strategy to combat Chinese competition and strengthen the global standing of the U.S. steel industry.
The company also highlighted Nippon Steel’s commitments to investment and workforce development, portraying the deal as a critical measure to ensure job stability and improved employee benefits.
This follows an op-ed by U.S. Steel CEO David Burritt, who warned that blocking the acquisition would only increase China’s dominance in the global steel market.
Despite these arguments, the United Steelworkers (USW) union remains firmly opposed to the deal. Industry analysts speculate that Cleveland-Cliffs, a major U.S. steel producer with strong ties to USW leadership, may influence the union’s position behind the scenes.
U.S. Steel sharply criticized the stance of the United Steelworkers, stating that if the deal fell apart, the only parties celebrating would be USW President David McCall, Cleveland-Cliffs, and Beijing, while America would lose out.
The Committee on Foreign Investment in the United States (CFIUS) reviews the acquisition to evaluate potential national security risks. Ultimately, Biden will make the final decision.
At the same time, the Department of Justice is conducting an antitrust review. Due to these ongoing evaluations, Nippon Steel has postponed its expected deal completion date from December 2024 to March 2025.
Biden is expected to announce his decision on the acquisition by January 7, 2025.
This high-stakes decision will crucially impact the future of the U.S. steel industry, its global competitiveness, and labor relations within the sector.
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