US Steel Warns Thousands Jobs at Risk Without Nippon Steel

(Bloomberg) — United States Steel Corp. is warning union leaders and politicians pushing to block its acquisition by Nippon Steel Corp. that doing so would imperil thousands of jobs and its Pittsburgh headquarters.

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Without the support of the Japanese steelmaking giant, US Steel would have to pivot away from its legacy blast furnaces, endangering union jobs and undermining the competitiveness of the American steel industry, according to a company statement Wednesday. The warning echoes comments by Chief Executive Officer David Burritt to the Wall Street Journal.

It’s the latest effort to garner support for the $14.1 billion transaction, which has been opposed by both Republicans and Democrats as well as the powerful United Steelworkers union, which is also based in Pittsburgh. Shares of US Steel rose as much as 3.9% Wednesday in New York, its biggest intraday jump since Aug. 21.

Nippon Steel said overnight it will appoint a US Steel board with a majority of US citizens, while the core senior management will also be Americans, should the bid be approved. It’s a potential olive branch to demands by President Joe Biden that the company remain American-operated, though they also want it to remain American-owned. Last week, Nippon Steel pledged an additional $1.3 billion of investment at US Steel to bolster its case.

Wednesday’s announcements come after Democratic Party presidential nominee Kamala Harris called for the steelmaker to remain “American-owned, and American-operated.” Both the vice president and Republican nominee Donald Trump have voiced their concerns about the takeover ahead of the November election.

With US Steel saying the deal’s failure would raise “serious questions” about whether the company’s headquarters can remain in Pittsburgh, members of its staff are hosting a rally there Wednesday in support of the takeover.

(Adds shares and overnight announcement by Nippon Steel)

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