Nippon Steel Corp. has announced a significant increase in its capital commitment, with a $1.3 billion pledge to enhance facilities in Pennsylvania and Indiana on top of a previous $1.4 billion commitment. This move is part of their nearly $15 billion acquisition of U.S. Steel, aimed at upgrading plants and strengthening the American steel industry.
David Burritt, President and CEO of U.S. Steel, praised Nippon Steel's commitment as a step towards expanding and improving U.S. Steel, emphasizing the importance of these investments in the future of American steel production. However, the United Steelworkers union has dismissed this as "lip service," expressing concerns over the deal's failure to address labor, pension, and contractual issues as per their agreements.
Despite ongoing opposition from the Steelworkers union, Nippon Steel remains optimistic about closing the transaction by the second half of 2024. The commitment to upgrade facilities, including the hot strip mill at the Irvin Plant and blast furnaces at Gary Works, is expected to prolong the life of these facilities, enhance productivity, and promote competitiveness in the American steel industry. The deal faces scrutiny from various political figures, with former President Donald Trump and senior U.S. senators expressing opposition on economic and national security grounds, while the Department of Justice and the Committee on Foreign Investment in the United States review it for compliance and national security concerns.