Nippon Steel clarifies spending pledge in effort to save U.S. Steel deal
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Nippon Steel Corp. clarified its spending plans at U.S. mills owned by United States Steel Corp. as part of last-ditch efforts to win over workers and politicians for its bid to buy the Pittsburgh-based steelmaker.
After meeting with United Steelworkers leaders, the Japanese firm released a letter to U.S. Steel staff on Monday. In it, the Japanese firm said it made new commitments with regards to where and when a previously announced $1.4 billion would be spent. The figure doesn’t include maintenance or depreciation, Nippon said.
“During our recent discussions with the USW leadership, we listened carefully to the USW’s requests for further details on our future plans,” the company said.
The letter also makes a previously announced additional $1.3 billion in capital expenditures legally binding. That money had been promised after an arbitration meeting, so had not yet been a binding proposal.
As part of the investment first announced in August, Nippon Steel said it would pump $300 million in U.S. Steel’s Gary Works operation in northwest Indiana, specifically to revamp the Blast Furnace #14, extending the facility’s operational life by up to 20 years.
Nippon Steel is seeking to allay concerns over job security at plants that use traditional blast-furnace production from iron ore as part of its pending $14.1 billion takeover of US Steel.
Both President Joe Biden and President-elect Donald Trump opposed the deal, which was announced a year ago and remains before federal regulators, including a review by the Committee on Foreign Investment in the US, or Cfius.
U.S. Steel shares added about 2% before normal trading hours on Monday. Nippon Steel shares were down 0.3%.