Pennsylvania Governor Josh Shapiro said on Tuesday that he cannot support Japanese firm Nippon Steel’s bid to buy US Steel in its current form because the United Steelworkers union is unhappy with the merger.
Shapiro, who is a contender to be Vice-President Kamala Harris’ Democratic Party running mate in the November US presidential election, said he was viewing the proposed merger through its impact on workers.
“Speaking from a state perspective as governor, if the US steel workers aren’t happy with this deal, which they are not, I’m not happy with this deal,” Shapiro said at an Internal Revenue Service event attended by Treasury Secretary Janet Yellen.
“If I don’t see a future where US Steel manufacturing continues here in the Commonwealth of Pennsylvania, and is expanding from what is happening right now, I’m not happy, so I’ve got really serious concerns,” he said.
Shapiro told a press conference after a tax event in Philadelphia that he will review any business deal through “the prism of how does it impact Pennsylvania workers”, as the state has grown thanks to US Steel and other industrial manufacturers.
US Steel, founded in 1901, is headquartered in Pittsburgh, Pennsylvania, a key battleground state in the November 5 election.
Both US President Joe Biden, who abandoned his bid for a second term and endorsed Harris to be his successor more than a week ago, and Donald Trump, the Republican nominee in the election, have backed US Steel’s unionised workers in their strong opposition to the deal.
The Japanese and US firms believe the merger, creating the world’s third-largest steelmaker by volume, would benefit them. A large majority of US Steel shareholders have also already approved the US$14.1 billion deal.
But since the planned all-cash transaction was announced in December, United Steelworkers International has spoken against it, turning it into a sensitive political issue.
Biden, who needed to secure support from trade unions for the presidential election, said multiple times earlier this year that the steelmaker should be domestically owned.
On Tuesday, Shapiro also said: “What’s been put forth on the table is not something that would enjoy my approval, and I’m going to continue to stand directly side-by-side and locked-arms with US steel workers, the very people who have built this commonwealth and this country.”
“They deserve real respect,” added the governor.
The acquisition plan needs to be approved by the Committee on Foreign Investment in the United States, which is in charge of examining certain foreign investment transactions in US firms and determining whether they pose national security threats.
The committee, also known as CFIUS, is chaired by Yellen, who said in April she accepted Biden’s view that US Steel should remain in American hands.
Asked where the merger plan’s review stands now, she said CFIUS will look at any transaction from a national security perspective and try to make the right decision, but that she is “not able to talk about the specifics”.
Additional reporting by Kyodo
