Nippon Steel: Acquisition of US Steel threatened by political obstacles

Nippon Steel faces significant challenges in its planned $14.1 billion acquisition of United States Steel. This merger not only encounters opposition from President Joe Biden and Vice President Kamala Harris, but also from former President Donald Trump. The leadership of the United Steelworkers union rejects the acquisition, although some members and stakeholders support it, citing benefits such as the planned $2.7 billion investments. Crucial to the deal's progression is the review by the Committee on Foreign Investment in the United States (CFIUS), whose recommendation is still pending. Biden reportedly plans to block the sale should it come to his desk. Amidst this political landscape, there are also positive developments. US Steel's shares saw a 7 percent increase in New York, and Nippon Steel's shares rose by up to 2 percent in Tokyo. Some union members near Pittsburgh advocate for the acquisition. Jason Zugai of United Steelworkers Local 2227 emphasizes that jobs in the Mon Valley region would be secured for the next 50 to 100 years. Opponents like United Steelworkers President Dave McCall warn that the merger endangers national security and critical supply chains. Pennsylvania Governor Josh Shapiro is also working behind the scenes to mediate and find a solution that protects jobs in Pennsylvania. The communication between US Steel and Nippon Steel was made public to clear up misunderstandings. Mori from Nippon Steel highlights the potential for joint successes in correspondence with McCall. US Steel insists that the financial investments would not be possible without Nippon Steel. Cleveland-Cliffs Inc. has also shown interest in US Steel but could not match Nippon Steel's offer. Political support against the deal comes from Senators Bob Casey and John Fetterman, among other political representatives. Ahead of the US presidential election, the future of US Steel is a central issue in Pennsylvania, a key state. The pressure on decision-makers remains high as economic and political debates continue.