A Japanese steelmaker looking to buy U.S. Steel announced on Wednesday that the majority of the board of directors will be made up of residents of the United States, despite growing political resistance to the $15 billion plan in the run-up to the November election in the United States.
Nippon Steel claimed that “core senior management members” and three of the board’s independent directors will be nationals of the United States in a statement outlining governance intentions.
Nippon Steel, the largest steelmaker in Japan, has maintained that the acquisition would benefit the companies and their employees as well as the United States and Japan, a crucial ally of the United States, in the face of opposition from the United Steelworkers union, President Joe Biden, and the two main contenders seeking his successorship.
As stated in a statement, “Nippon Steel continues to believe that the transaction will enhance American national security by bringing cutting-edge technologies to the United States, reinforcing U.S. Steel and its domestic production capabilities, and ultimately making the American industrial base and supply-chain more resilient and better positioned to compete against future pressures from state-supported Chinese competitors.”
During a joint event with Biden on Monday in Pennsylvania, a crucial swing state, Democratic presidential nominee Vice President Kamala Harris made her first public opposition to the agreement known.
“It is vital for our nation to maintain strong American steel companies,” Harris said to cheers in Pittsburgh, where U.S. Steel is located. “And I wholeheartedly concur with President Biden that U.S. Steel ought to continue to be owned and run by Americans.”
The United Steelworkers union applauded Harris’ opposition to the sale, saying she “once again made it clear that she will always stand up for steelworkers.” The union claims the sale could have significant effects on workers, supply chains, and national security in the United States.
The Republican presidential candidate and former president Donald Trump reaffirmed last month his pledge from February to veto the agreement if elected. In March, Biden initially voiced his disapproval of the deal.
“Committed to the transaction with Nippon Steel, which is the best deal for our employees, shareholders, communities, and customers,” U.S. Steel declared in a statement on Monday.
Nippon Steel announced on Wednesday that the company’s headquarters will stay in Pittsburgh and that it will prioritize production at U.S. Steel to satisfy demand in the American market.
It stated that decisions on trade matters would require approval by a majority of the independent American directors “to ensure that such decisions are made without interference by Nippon Steel.” Americans would form an internal officer-level “trade committee” to advise the U.S. Steel board on trade matters and record the decision-making process.
Additionally, the corporation had previously stated that the purchase, which was announced in December of last year, would not result in facility closures or layoffs.
According to Nippon Steel, the governance policy was unveiled on Wednesday with the intention of “ensuring the benefits of the transaction, while also maintaining U.S. Steel as an iconic American company.”
