Jean J. Puskar/AP
This is part of US Steel’s Edgar Thompson plant in Braddock, Pennsylvania, on Monday.
A potential takeover of US Steel by a rival Japanese steelmaker will be pushed back by the US government, according to comments from US Commerce Secretary Gina Raimondo.
“President Biden is very focused on making sure America has a vibrant steel industry for national security purposes,” Raimondo said in an interview with CNBC that aired Thursday.
Raimondo declined to directly weigh in on US Steel Must buy contract Nippon Steel, Japan’s largest steelmaker, said a deal for a foreign firm to buy the U.S. steelmaker for $14.1 billion warrants further scrutiny.
“I think it’s fair to say that it’s going to get a fair bit of scrutiny because we have to protect the American steel industry, American manufacturing and American steel workers,” he said.
US Steel once was A very prestigious company in the world, but as the country’s economy shifted from manufacturing to services, the 122-year-old company’s business collapsed. US Steel’s revenue of $21 billion last year is equivalent to what Walmart brings in every two weeks.
“We believe this combination is truly the best for everyone,” U.S. Steel CEO David Burritt said Monday. “Today’s announcement benefits the U.S. as well — ensuring a competitive, domestic steel industry while strengthening our presence globally.”
The deal faced pushback from the steel industry and U.S. lawmakers, despite US Steel’s declining earnings.
The United Steelworkers union said it would urge regulators to block the sale of U.S. steel to a foreign company, calling the deal “greedy” and “short-sighted.”
“We were open throughout this process to working with US Steel to keep this iconic American company locally owned and operated, but instead it chose to sell to a foreign-owned company, putting aside the concerns of its dedicated workforce,” the United Steelworkers Union said. President David McCall.
On Thursday, Raimondo echoed the union’s concerns, saying “the U.S. government cannot support any deal that undermines American workers, the steelworkers union or the steel industry.”
Raimondo wasn’t the only government official to express skepticism since the deal was announced on Monday.
Ohio Republican Senator JD Vance urged US Steel to reject a takeover bid from a foreign company because of the steel industry’s role in manufacturing military equipment.
“Today, a critical part of America’s defense industrial base has been auctioned off for cash to foreigners,” he said Monday.
Pennsylvania Democratic Senator John Fetterman, formerly mayor of Braddock, Pennsylvania, where one of US Steel’s first plants still operates, said he would work to block the transaction.
“Steel has always been about security, both in terms of our national security and the economic security of our steel communities. “I am committed to doing anything I can using my platform and my position to prevent these foreign sales,” Fetterman said.
At least one of US Steel’s domestic competitors has spoken out against the deal.
“It’s important to keep our manufacturing in the U.S.,” said Cleveland-Cliffs and American Iron & Steel CEO Lorenzo C. Goncalves said. “We cannot allow foreign ownership. We cannot allow foreign companies to come in and destroy American jobs.
Cleveland-Cliffs previously bid to buy US Steel, and Goncalves said his company was interested in a deal.
— CNN’s Chris Isidore contributed reporting.