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    Home News Nippon Steel touts confidence in U.S. Steel takeover despite political opposition
    Nippon Steel touts confidence in U.S. Steel takeover despite political opposition
    Business, Nation & World, News, PA State News
    May 23, 2024

    Nippon Steel touts confidence in U.S. Steel takeover despite political opposition

    PITTSBURG (TNS) — Despite the uncertainty swirling around a once-in-a-generation steel acquisition that has Japanese investors and the American politico on the edge of their seats, Takahiro Mori remains “excited about the future.”

    “I don’t care about the noises or criticism, because I’m very confident that our deal is the best,” he said Wednesday during a lengthy sit-down interview with the Post-Gazette.

    Mori is the Nippon Steel executive charged with landing the $14.9 billion takeover of U.S. Steel, first announced in December, which has attracted sharp rebuke from all levels of government, and continued barbs from a union unswayed by the Japanese steelmaker’s overtures.

    During a wide-ranging conversation, Mori addressed the political challenges to sealing the deal and shed new light on the negotiations so far. He also divulged details on talks with the Japanese government and discussed how relocating Nippon Steel North America’s headquarters from Houston to Pittsburgh will benefit the state economy.

    The move isn’t just symbolic, Mori said.

    “We have eight companies in the United States, and [Nippon Steel North America] is a holding company. That means all the federal taxes are currently going to Texas, but now are coming here.”

    Mori said he personally offered that incentive to Pennsylvania Gov. Josh Shapiro.

    “’Can you commit it,’ he asked me, and I answered, ‘Yes, I’m the man that determines such kinds of things,’ “ Mori said. “He appreciated that.”

    A spokesperson for the governor declined to comment on the specific exchange but said Nippon’s commitment fit with his priority of building and protecting Pennsylvania jobs.

    The United Steelworkers union has proven far less amenable.

    In March, Mori joined USW President David McCall in Pittsburgh to offer promises that jobs and plants would be protected. Fifteen minutes after the meeting, Mori said USW issued a statement that “no progress” had been made. There hasn’t been a face-to-face meeting since, which Mori said is preventing them from finding common ground.

    “Once this kind of discussion starts, I’m pretty much sure we can find the solution,” he said.

    So far, Nippon has promised to infuse U.S. Steel’s assets with fresh technology — including $1.4 billion in capital spending — while protecting jobs, plants and pensions. Asked if McCall is simply holding out for a higher number, Mori said: “If so, please tell me.”

    Nippon does not necessarily need the union’s support to close the deal.

    “From a legal point of view, the [acquisition] doesn’t require union agreement,” Mori said. “However … the employee is an asset for the company … and we are going to have a relationship for a long time.

    “So it’s much, much better to reach an agreement before the closure.”

    But the deal has become a political football, with both presidential candidates effectively vowing to block the sale while wooing Pennsylvania’s union voters. Some observers expect the topic to come up during next month’s debate between Joe Biden and Donald Trump.

    Mori said he hopes the climate will cool after the election. “After the election, it’s no longer the issue,” he said.

    Earlier this month, Nippon and U.S. Steel pushed the potential closing date to as late as December. As for which candidate would be better for the deal, Mori said, “I have no theories.”

    The Japanese government has stayed out of the negotiations, but they’re aware of the stakes, Mori said. “We had some conversation with the government, but no specific requests.”

    The executive vice president said Nippon has long been interested in expanding its presence in the American steel market, although it wasn’t wasn’t specifically interested in U.S. Steel until Cleveland-Cliffs made its first bid last fall.

    “This time is a kind of opportunity for the generations,” he said. “And if this doesn’t happen we’re gonna take a long, long time to get into this market.”

    To finalize the deal, Nippon first has to clear two regulatory reviews: an antitrust probe by the Department of Justice and national security scrutiny from the Committee on Foreign Investment in the U.S.

    Mori said he’s confident in both.

    The acquisition will strengthen American supply chains, which should bolster, not threaten, national security, he said, and Nippon is prepared to sell its joint stake in an Alabama plant to partner ArcelorMittal, if the government deems that necessary to prevent a monopoly.

    Once Mori does his part to close the sale, Nippon Steel North America CEO Hiroshi Ono will take over, moving to Pittsburgh with a handful of Houston managers and engineers.

    If their experience is anything like Mori’s, the partnership could be a great fit, and one that adds to the city’s legacy.

    “It’s a kind of combination of history and modern,” Mori said of Pittsburgh. “I love the city.”

    Tags:

    donald trump executive branch of the government of the united states joe biden politics politics of the united states u.s. steel united states united states presidential elections united steelworkers vice president of the united states
    EVAN ROBINSON-JOHNSON Pittsburgh Post-Gazette

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