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The stories that matter on money and politics in the race for the White House
Nippon Steel has pledged to appoint a board for US Steel with a majority of US citizens if its $14.9bn deal for the company is approved, after vice-president Kamala Harris said on Monday that it should remain “American-owned and American-operated”.
The Japanese company, which launched its bid for US Steel in December, said on Wednesday that the board would also include three independent directors who are US citizens and that the “core senior management members” would be American.
It added that US Steel would be owned by Nippon Steel North America, a New York-based subsidiary of the Japanese company “that has operated in the United States for over 50 years”.
The new pledges by Nippon Steel are part of a concerted lobbying effort to convince US lawmakers that it is an acceptable owner of the Pittsburgh-based company, following a bipartisan backlash against the deal.
Both Democrats and Republicans have been trying to court blue-collar voters in the critical swing state of Pennsylvania in the run-up to November’s election.
Donald Trump, the former president and Republican nominee for the White House, has vowed to block the bid and Harris’s comments about the proposed foreign takeover echo US President Joe Biden’s own opposition to the deal. However, they have new significance since Harris became the Democratic nominee for president.
Speaking in Pittsburgh at a Labor Day union rally, Harris had said: “We will continue to strengthen America’s manufacturing sector, US Steel is a historic American company, and it is vital for our nation to maintain strong American steel companies.”
“US Steel should remain American-owned and American-operated,” she told the cheering crowd. “And I will always have the back of America’s steelworkers and all of America’s workers.”
Harris has gained the endorsement of most of the crucial US labour unions, which are a powerful constituency within the Democratic party and help rally voters in battleground states.
However, opposition to the deal had sparked concerns in Washington and Tokyo that it could damage relations with Japan, one of the US’s closest allies in its efforts to contain China’s military and economic rise.
As part of its efforts to allay fears in Washington and win over unions, Nippon Steel said last week it planned to spend at least an additional $1.3bn on US steel plants if the deal was approved.
The money would come on top of a $1.4bn investment already announced and in addition to promises to not move capacity outside the US, lay off staff or close plants as a result of the deal.
Mike Pompeo, the former secretary of state under Trump, has also been brought on board by Nippon Steel as part of the lobbying.
On Wednesday, Nippon Steel reiterated its belief that the deal “will revitalise the American steel rustbelt, benefit American workers, local communities, and national security in a way no other alternative can”.
“Simply put, US Steel and the entire American steel industry will be on much stronger footing because of Nippon Steel’s investment in US Steel — an investment that Nippon Steel is the only willing and able party to make”, the company added.