Harris backs US ownership of US Steel, in blow to takeover by Japanese company

By CNN Newsource

Published September 2, 2024 8:24 AM

By Kevin Liptak, Kayla Tausche and Samantha Waldenberg, CNN

(CNN) — Vice President Kamala Harris said Monday that US Steel should remain domestically owned, saying during a campaign stop in Pittsburgh that it is “vital for our nation to maintain strong American steel companies.”

Harris’ comments marked the first time she lent her voice to the dispute over the proposed sale of US Steel to Nippon Steel, Japan’s biggest steelmaker.

“The president mentioned it: US Steel is a historic American company, and it is vital for our nation to maintain strong American steel companies,” Harris said at the Labor Day event after being introduced by Joe Biden. “And I couldn’t agree more with President Biden, US Steel should remain American owned and American operated.”

The White House has previously opposed the controversial deal, with Biden saying it is “important that we maintain strong American steel companies powered by American steel workers.” Biden outlined his position during a March event in Pittsburgh, nicknamed “Steel City,” where he visited the headquarters of the United Steelworkers and called for higher tariffs to protect American manufacturing.

One week prior, when Biden hosted Japanese Prime Minister Fumio Kishida for a state visit, Kishida was asked by a reporter whether he saw US politics influencing the $14 billion takeover bid. Kishida said, “Japan believes that appropriate procedures based on law is being implemented by the US government” to evaluate the deal.

Biden, asked the same question, said simply that he stands with both American workers and American allies overseas, without elaborating on his further involvement.

For the deal to close, it needs approval from both the Justice Department, which enforces antitrust laws, and the normally low-profile but powerful Committee on Foreign Investment in the United States, which evaluates takeovers on national security grounds. That committee comprises members of Biden’s cabinet, including the secretaries of treasury, commerce, defense, state, homeland security and the attorney general.

It remains unclear to what extent Biden or Harris, in their official capacity, will work to block the deal on national security grounds in the treasury-led review.

Representatives for US Steel and Nippon Steel declined to comment on whether the companies had briefed Harris on the deal.

In August 2023, US Steel rejected a takeover bid by Ohio-based Cleveland Cliffs to buy the company for $7.3 billion. After months evaluating alternate suitors, US Steel agreed to sell to Japan’s largest steelmaker for more than twice what Cleveland Cliffs had proposed paying. US Steel shareholders overwhelmingly voted in support of the Nippon deal.

Under the current terms of the deal, US Steel would retain its name and Pittsburgh headquarters. Nippon has also pledged an additional $1.3 billion to refurbish two outdated mills in Pennsylvania and Indiana.

In a statement to CNN, US Steel’s chief executive officer said those investments go well beyond what the company would be able to do on its own.

“The bottom line is these are investments in the future of American steelmaking and the employees, families, and communities that rely on it,” CEO David Burritt told CNN. “US Steel will be a much stronger company as a result of the transaction and these investments – the entire American steel industry will be stronger and more globally competitive, too.”

This story and headline have been updated with additional developments.