Bob Tita of The Wall Street Journal reports that Wednesday marks a year since the agreement, but the Tokyo-based company hasn’t received the support it needs from Washington. Tita writes:
In a meeting room facing U.S. Steel’s century-old plant, Takahiro Mori offered his vision for the plant’s next chapter under a new owner.
Flanked by steelworkers and city leaders, the vice chairman of Japan’s Nippon Steel last week pledged to invest nearly $950 million in U.S. Steel’s largest mill. Nippon Steel also offered bonuses to all U.S. Steel employees, amounting to $20 million for workers in Gary.
Mori was winning the room at City Hall. He hasn’t had the same luck in Washington, D.C., where political leaders control the deal’s fate. […]
If the deal collapses, U.S. Steel will likely have a tough time in the near term boosting sales and profit on its own. Steel prices are down nearly 40% from a year ago. Buyers have repeatedly rejected price increases from steelmakers since the spring with plenty of cheaper steel still available.
“Last year at this time, steel prices were on fire. This year, it’s just blah,” said Jeremy Flack, CEO of Flack Global Metals, a Phoenix-based distributor of steel and aluminum.
If the deal is blocked, falling steel prices and weakening manufacturer demand make it unlikely that U.S. Steel would attract hefty offers from other deep-pocketed suitors, industry analysts said. […]
“We still work together where we have to, but it’s definitely strained,” said Morgan, grievance committee chairman for the union at a Mon Valley Works plant in West Mifflin, Pa., a site where local union leaders are supporting Nippon Steel.
Morgan, 50, who has worked for U.S. Steel for more than 20 years, said he objects to Nippon Steel’s Mori appealing to impressionable workers and plant-level union leaders after being rebuffed by McCall. “That doesn’t sit right with me,” he said.
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