Tokyo, Aug. 29 (Jiji Press) — Nippon Steel Corp. has announced its intention to invest an additional $1.3 billion in United States Steel Corp., according to a statement released by the Japanese steelmaker on Thursday.
If the planned acquisition of U.S. Steel is successful, Nippon Steel will direct its investment towards two key facilities: Mon Valley Works in Pennsylvania and Gary Works in Indiana. This investment comes in addition to the $1.4 billion already pledged by Nippon Steel to the United Steelworkers (USW) labor union by 2026.
The majority of the funds, at least $1 billion, will be allocated towards replacing or upgrading hot strip mills at Mon Valley Works. The remaining $300 million will be used to extend the operational life of Gary Works’ No. 14 blast furnace for up to two decades.
While both Nippon Steel and U.S. Steel have agreed on this buyout deal, it has faced strong opposition from USW who are vehemently against it.
Nippon Steel hopes that through these additional investments, they can garner more support for the transaction amidst growing opposition from both Democrats and Republicans ahead of the upcoming U.S presidential election in November.
Initially scheduled for completion in September, Nippon Steel has decided to delay finalizing the acquisition until December.
This move signifies a significant step forward for Nippon Steel as they seek expansion opportunities within the United States market while also navigating potential challenges posed by political dynamics surrounding this deal.