USS/Nippon deal: Who will have the happiest holidays?

Monday, Dec. 23, is the reported deadline for the national security review of the deal to be completed.

The Committee on Foreign Investment in the US (CFIUS) is reportedly split on whether the deal poses concerns for the nation’s security, according to the Financial Times.

While CFIUS members from the Treasury, Pentagon, and State Department don’t see a risk in the deal, FT said US Trade Representative Katherine Tai remains opposed.

If Tai can’t be persuaded and CFIUS remains split by Monday’s deadline, President Biden will have to decide the deal’s fate. Sources have said the lame-duck president would block the deal.

Nippon’s last-ditch efforts to seal the deal

Nippon is doing everything it can to make this acquisition happen.

To sweeten the deal, the steelmaker offered U.S. Steel union and non-union employees a $5,000 closing bonus following the transaction’s closing. Combined with a €3,000 bonus for USS employees in Europe, Nippon’s offer would pay out nearly $100 million in closing bonuses, according to the company.

“We want to thank all of U.S. Steel’s employees for their continued hard work. Our goal is to protect and grow U.S. Steel, and its people are the most important asset in achieving this goal,” stated Takahiro Mori, Nippon’s representative director and vice chairman, upon the offering of the bonuses.

USW also split: Leadership opposed, steelworkers rally

Despite multiple meetings with Nippon and the mayors from the Mon Valley and Gary areas, the leadership of the United Steelworkers (USW) union remains opposed to the acquisition.

“Nippon pitched another offer at the meeting, but the bottom line is we still do not have ironclad commitments for the Mon Valley, Gary, or the other plants,” said a letter to union members on Dec. 20. The letter was signed by USW International President David McCall and District 7 Director and Chairman of the USW negotiating committee Mike Millsap.

“For USS and Nippon this deal is nothing but an opportunity to further line their pockets; our security and our future will always be an after-thought,” they said.

However, the mayors had a different view after the meetings.

“USW leadership is putting jobs at risk with its actions, plain and simple,” said a statement on behalf of Braddock, Pa., Mayor Cletus Lee; West Mifflin, Pa., Mayor Chris Kelly; and Gary, Ind., Mayor Eddie Melton. The statement was posted on the bestdealforamericansteel.com website hosted by Nippon and U.S. Steel.

“We have been through a lot of struggle in our communities, but the USW’s behavior is a new low,” the mayors’ statement said. “We call on everyone with a stake in the success of U.S Steel to reject the USW leadership’s position and work to close this critical transaction.”

Some steelworkers also share a different opinion than USW leadership on the deal.

USS employees recently rallied in support of the sale at the company’s Clairton Works in Pennsylvania and Gary Works in Indiana. Steelworkers at USS plants in Alabama, Indiana, and Minnesota joined in support by video, the Washington Post reported on Dec. 20.

Happy holidays?

Will Santa bring gifts for the leadership, employees, and shareholders of U.S. Steel and Nippon Steel, and lumps of coal for USW leadership and politicians opposed to the deal?

Come Christmas morning, USS employees may just receive that $5,000 closing bonus. And USS executives could see their stockings stuffed with millions of dollars. Imagine the giddy excitement (or perhaps a Grinch-like grin) on USS President and CEO David Burritt’s face when he finds a $70-million+ golden parachute under his tree!

Or will it be vice versa?

Will USS leadership see their bonuses turn to coal before their very eyes while USW leadership and another allied Grinch share a toast of champagne to celebrate this holiday season?

I don’t think anyone involved in this deal got the memo that it’s supposed to be Christmas vacation!