The acquisition has been approved by the boards of both companies and is targeted to close in the second or third quarter of 2024.
GRANITE CITY, Ill. — It's a mix of emotions in the Metro East after a Japanese steelmaker acquired U.S. Steel for billions of dollars.
U.S. Steel, a Pittsburgh steel producer, is being acquired by Nippon Steel, Japan's largest steelmaker, in an all-cash deal valued at about $14 billion.
In a new release, U.S. Steel said this combines world-leading technologies and manufacturing capabilities to better serve customers in the United States and globally. It continued by saying it strengthens a diversified and competitive steel industry in the United States to the benefit of customers through investment collaboration between two global steel innovators.
The deal honors all collective bargaining agreements with the United Steelworkers Union. The statement read, "This is part of a commitment to maintaining strong stakeholder relations."
Dan Simmons, president of United Steelworkers Local 1899, was taken aback by a new deal moving forward.
"The union was informed this morning about the acquisition sale of U.S. Steel to Nippon. My first reaction is disappointment," Simmons told a room of reporters. "I had my concerns because I haven't heard word from Nippon and knowing what their direction is and their operation business plan for the acquisition including Granite City Works."
U.S. Steel will keep its name and headquarters in Pittsburgh.
Simmons admitted he was worried about the continued involvement of U.S. Steel.
"We know U.S. Steel's operation plan was for Granite City, it wasn't positive," he added.
In September, U.S. Steel temporarily idled furnace B in a move it called "risk mitigation" in response to the United Auto Workers strike. At the end of November, U.S. Steel's operational plan in Granite City was to idle steel-making indefinitely.
Simmons said, "The right decision would be to fire those furnaces back up and make steel again because prices are very good."
Simmons was looking forward to a new owner, specifically Cleveland Cliffs.
"We have history with them and they are good labor partners, they embrace the union," Simmons said.
But Nippon gave nearly double what was offered just four months ago by Cleveland Cliffs.
While Nippon's deal is about the future, Simmons was looking at the past.
"The optimistic side of this is that Nippon was a part of a joint venture back many years ago with National Steel when I was an employee then and they were a good partner to have," he added.
U. S. Steel acquired the assets of the former National Steel Corp. in 2003.
Yet, he still worries about his union workers.
"They are mostly concerned with the same questions we have, especially the members who have been laid off. They want to know what does this mean for them, if they continue layoffs, I don't have those answers because I am not having any meetings with them," Simmons added.
Simmons believes while there are still unknowns, a new deal could be a new chapter.
"We'll look to see if this partnership with Nippon is a good partner. I'm hoping they look at this differently with the same vision we have," he said. "I welcome a face-to-face opportunity to see what we can offer here in Granite City specifically."
The acquisition has been approved by the boards of both companies and is targeted to close in the second or third quarter of 2024. It still needs approval from U.S. Steel shareholders.
There was already a scheduled union meeting Thursday, prior to the announcement. Simmons expects it to be packed.
Granite City Mayor Mike Parkinson said he learned Monday morning about the acquisition.
He admitted, there was still a lot of uncertainty and questions.
Parkinson said, "Talk is cheap, do they have the capital to honor all those collective bargaining? I haven’t communicated with them and it makes you suspect of them not being forthcoming."
The United Steelworkers (USW) International President David McCall issued a statement slamming the announced deal:
“To say we’re disappointed in the announced deal between U.S. Steel and Nippon is an understatement, as it demonstrates the same greedy, shortsighted attitude that has guided U.S. Steel for far too long.
“We remained open throughout this process to working with U.S. Steel to keep this iconic American company domestically owned and operated, but instead it chose to push aside the concerns of its dedicated workforce and sell to a foreign-owned company.
“Neither U.S. Steel nor Nippon reached out to our union regarding the deal, which is in itself a violation of our partnership agreement that requires U.S. Steel to notify us of a change in control or business conditions.
“Based on this alone, the USW does not believe that Nippon understands the full breadth of the obligations of all our agreements, and we do not know whether it has the capacity to live up to our existing contract. This includes not just the day-to-day commitments of our labor agreement, but also significant obligations to fund pension and retiree insurance benefits that are the most extensive in the domestic steel industry.
“Our union intends to exercise the full measure of our agreements to ensure that whatever happens next with U.S. Steel, we protect the good, family-sustaining jobs we bargained. We also will strongly urge government regulators to carefully scrutinize this acquisition and determine if the proposed transaction serves the national security interests of the United States and benefits workers.
“No union has actively engaged in more acquisitions in its core industries than the USW, and rest assured, our union will hold management at U.S. Steel accountable to every letter of our collective bargaining and other existing agreements.”
Granite City union president has mixed emotions after Japanese company's pending acquisition of U.S. Steel - KSDK.com
Read More
No comments:
Post a Comment