Gary Mayor Eddie Melton and Nippon Steel Vice President Takahiro Mori at Thursday’s press conference in city hall

Sale of U.S. Steel to Nippon will bring more than $1 billion investment to Gary Works

Contributed By: The 411 News

Even though their local and national union leaders oppose the purchase of USX by Nippon Steel, six union steel workers stood with Gary Mayor Eddie Melton and Nippon’s Vice Chairman Takahiro Mori at Thursday’s press conference in city hall.

It’s a sign of changes coming to the steel industry believes Sherray Williams, a member of USW Local 1066 who supports the Nippon offer.

“Some would like to see the sale of the company; some other members of our union don’t. Current CEO Burritt stated he would close it and sell it off to mini-mills if the sale doesn’t go through,” Williams said. “If you ask me it’s a smart business move. You are talking about $14.9 billion. USX is making a profit.”

USX and Nippon announced the sale nearly a year ago, with the expectation of closing the deal in the second half of 2024. U.S. Steel’s shareholders approved the purchase in April.

Now it is in the hands of a panel of regulatory officials who review acquisitions of American businesses by foreign buyers to determine if the deal poses a risk to our national security.

A decision from CFIUS (Committee on Foreign Investment in the United States) – pronounced siff-ee-yus – is due before Christmas. It’s led by the Treasury secretary, with other members from the State, Defense, Justice, Commerce, Energy and Homeland Security departments.

The United Steelworkers union has asked President Joe Biden to block Nippon’s takeover of U.S. Steel.

“U.S. Steel has been an iconic American steel company for more than a century, and it is vital for it to remain an American steel company that is domestically owned and operated,” Biden said in a statement in March.

President-elect Donald Trump is also against the purchase.

CFIUS will make a recommendation to President Biden to block the deal or let it go through.

Initially skeptical of the sale to Nippon, Mayor Melton now sees benefits for the city in the partnership.

“This is not about just Gary, Indiana. There are communities in Pittsburgh, Birmingham, and in the Mon [Monongahela] Valley wrestling with the fate of this deal,” said Mayor Melton. “I wasn’t sure what it would look like for Gary. I was uncertain about the direction we would go into as a country with this decision.”

Japan is an ally of the U.S. and Nippon operates 2 plants in Indiana, one for nearly 50 years, Melton said.

The mayor went to Washington, DC seeking support in Congress for the deal. He read a letter from U.S. Representatives Bennie Thompson and Maxine Waters urging President Biden to support the purchase.

“Nippon’s investments and technology sharing will protect and grow facilities like Gary Works so that it continues to serve as the economic engine for Gary, Lake County and the region,” Vice Chairman Mori said. “There will be no jobs lost or plants closing because of this deal.”

Mori reiterated Nippon’s promise to honor all current union collective bargaining agreements and said more steelworkers will be needed.

“We are not going to ship slabs from across the world into the United States. We believe steel is a local business and U.S. customers should receive slabs from steel made here,” Mori said.

Along with the planned $300 million repair for the No. 14 blast furnace at Gary Works, an additional $950 million will be allocated in Gary. Mori said Nippon plans to repair all blast furnaces by 2030.

Earlier this week, Nippon announced eligible USW union members would get a $5,000 bonus when the deal closes. “This means roughly $20 million for Gary Works 4,000 employees,” Mori said.

“This partnership means so much,” Mayor Melton said. “It’s the right thing for the city, the right thing for the economy and the right thing for the United States.”


Members of GARD (Gary Residents for Responsible Development) rallied during the press conference to oppose the sale of U.S. Steel

On the steps of city hall during the press conference, members of GARD (Gary Advocates for Responsible Development) carried signs opposing the sale.

One sign said “Gary Needs Green Steel.” GARD is against USX continuing to operate blast furnaces because of the air pollution and greenhouse gases they produce. Nippon’s plan to bring more furnaces online will worsen Gary’s air quality, GARD says.

Dorreen Carey, GARD’s president, also contends there is a sustainability issue with blast furnaces that burn coal and iron ore in the iron-making process.

“The modern direct reduction (DR) furnace has already made the blast furnace an obsolete technology in the U.S., and all will likely shut down by the early 2040s or before. The DR furnace is cleaner and costs are lower. Any steelmaker whose transition from the blast furnace to the DR furnace is ‘too slow’ will fail,” Carey said in a GARD statement.

“Nippon is fully aware of this. It appears, however, that if its purchase of US Steel is approved, the company has decided it will install the next generation of modern iron-making technology in locations other than its Gary and Monongahela Valley steel mills,” Carey said. “It will make the investments needed to keep these mills running for another ten to fifteen years. But it will then shut them down when it has built their replacements at other locations.”

Story Posted:12/14/2024