On Monday, President Trump posted on his Truth Social platform his intent to block the sale of Pittsburgh-based U.S. Steel by Nippon Steel, a Japanese company.
Saying he is “totally against” the purchase, Trump promised “a series of tax incentives and tariffs” to revitalize U.S. Steel once he takes office in January. Trump’s latest pronouncement echoed statements he made during the presidential campaign earlier this year.
A relatively unknown government bureaucracy, the Committee on Foreign Investments in the United States, which oversees an analysis and approval process when foreign entities propose to buy American companies, is currently reviewing Nippon’s offer to purchase U.S. Steel.
Last December, Nippon announced its intent to purchase the American steel company for just under $15 billion.
The deal has exposed some divisions in the steel labor union, with David McCall, the president of United Steelworkers speaking out against the purchase earlier this year, saying Nippon’s historical business practices would be ‘to the detriment of American steelmaking and American steelworkers.”
More recently, steelworker local unions in Western Pennsylvania voiced their frustration Trump’s opposition of the sale. Local 2227 leadership called the incoming President’s pronouncement “a gut punch” on Tuesday during a panel discussion hosted by the Hudson Institute in Washington, D.C.
During the deliberations over the sale, Nippon said it would honor collective bargaining agreements made before its purchase between the union and U.S. Steel. Additionally, in August, Nippon announced it would invest an additional $1.3 billion to upgrade and modernize the company’s Mon Valley Works in the Pittsburgh area. McCall is skeptical of Nippon’s commitment to reinvigorating Mon Valley.
Despite Trump’s opposition to the purchase, Nippon reiterated its commitment to the purchase and its promise “not to transfer any U.S. Steel production capacity or jobs outside the United States.”
U.S. Steel’s stock price rose Wednesday on the increased prospects of the deal being approved.
