Steel companies US Steel plans factory closure if Nippon takeover fails
The US steel company US Steel has threatened to close its factories in Pennsylvania, an important state for the US presidential election.
05.09.2024, 05:52
SDA
"If the deal with Nippon Steel does not go through, it raises serious questions about the whereabouts of US Steel's headquarters in Pittsburgh," the Pittsburgh-based company said in a statement. If the US authorities prevent a takeover by Japanese competitor Nippon Steel, the company will turn its back on its factories, putting thousands of jobs at risk, it added. At a rally at the company's headquarters in Pittsburgh, numerous supporters of the deal demonstrated and declared that it was a kind of life insurance for this industry, which characterizes the region in Pennsylvania.
Takeover deal known since December
The planned takeover by Nippon Steel was announced in December. The purchase price was to be 14.9 billion dollars (12.6 billion Swiss francs). The deal included planned investments of 2.7 billion dollars in US steel factories in Pennsylvania and Indiana, among other places. However, the steelworkers' union (USW) as well as cross-party opposition from Washington to a takeover of the traditional company by the Japanese competitor. The "Washington Post" reported that President Joe Biden has now decided to prohibit the takeover. As a result, US Steel shares lost almost 20 percent of their value on the stock market.
Harris and Trump against takeover
During a visit to Pittsburgh on Monday, Democratic presidential candidate Kamala Harris declared that US Steel should "remain American-owned and American-run". Republican presidential candidate Donald Trump also spoke out against a takeover by the Japanese. The dispute over US Steel is significant for the presidential election campaign, as Pennsylvania is one of the potentially decisive key states in the election on November 5. The state, which is part of the industrial region known as the rust belt in the north of the USA, sends 19 electors to the Electoral College, which elects the US President. At least 270 of the 538 votes in the Electoral College are required to enter the White House.
Pennsylvania is now one of the "swing states"
Pennsylvania used to be traditionally Democratic. However, the industrial decline in the region led to Trump and the Republicans gaining ground and Pennsylvania is now one of the so-called swing states, which sometimes vote in favor of the Democratic candidate and sometimes in favor of the Republican candidate. Trump won there in 2016, Biden had the upper hand in 2020.
