The Gary Works plant in northwest Indiana is U.S. Steel's largest steel manufacturing facility.
(Alan Mbathi/IPB News)
The Indiana context
From Indiana Capital Chronicle
Indiana’s Gary Works is U.S. Steel’s largest manufacturing plant, according to the company’s website. It can handle more than 7.5 million net tons of raw steel annually. The site has more than 4,300 employees, per Fox Business.
It is unclear how the Gary plant will be impacted by the decision.
Nippon Steel proposed buying the Pittsburgh-based steelmaker last December, in a deal valued at $14.9 billion.
U.S. Steel CEO David Burritt has warned that his company would have to close mills if Nippon Steel is unable to acquire it, according to The Wall Street Journal.
Nippon had pledged to invest nearly $3 billion into updates at U.S. Steel’s Gary and Pittsburgh mills.
President Joe Biden announced early Friday he will block the sale of U.S. Steel to the Japanese company Nippon Steel, in one of the last acts of his presidency.
Biden had saidthat U.S. Steel should remain a domestically owned and operated company, so the orderwas not a surprise. The White House in December called for “serious scrutiny”of the $14.1 billion deal, which was under review by the Committee on Foreign Investment in the United States, an executive branch body.
“We need major U.S. companies representing the major share of US steelmaking capacity to keep leading the fight on behalf of America’s national interests,” Biden said in a Friday statement. “As a committee of national security and trade experts across the executive branch determined, this acquisition would place one of America’s largest steel producers under foreign control and create risk for our national security and our critical supply chains.
“So, that is why I am taking action to block this deal. It is my solemn responsibility as President to ensure that, now and long into the future, America has a strong domestically owned and operated steel industry that can continue to power our national sources of strength at home and abroad; and it is a fulfillment of that responsibility to block foreign ownership of this vital American company. U.S. Steel will remain a proud American company – one that’s American-owned, American-operated, by American union steelworkers – the best in the world,” he said.
The sale was opposed by the United Steelworkers International union, a powerful labor group that had continually urged Biden, who saw union workers as a key part of his political coalition, to keep U.S. Steel domestically owned. The union renewed that request in a Wednesdaysocial mediapost.
In a Friday statement, USW President David McCall thanked Biden and said the union members had “no doubt that it’s the right move for our members and our national security.”
“We’re grateful for President Biden’s willingness to take bold action to maintain a strong domestic steel industry and for his lifelong commitment to American workers,” McCall said. “Moving forward, we’re confident that with responsible management, U.S. Steel will continue to support good jobs, healthy communities and robust national and economic security well into the future.”
Biden issued the order under the Defense Production Act, which allows the president to intervene in private industrial matters if national security is threatened. In his statement, he argued that retaining a strong steel industry was essential for national security.
