Arbitration Favors US Steel Over Deal
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A U.S. arbitration panel has come out in favor of United States Steel Corp. in a dispute with union workers over Nippon Steel Corp.’s plan to buy the Pittsburgh-based company, according to the United Steelworkers.
The steelworkers union opposes the $14.1 billion takeover and argued that the Japanese firm was using a North American shell company to shield itself from its obligations. The panel’s decision from last month’s hearing rebuffs allegations of labor agreement breaches in the deal. The outcome of the hearing hadn’t been made public prior to the union’s statement.
While the arbitration panel ruling represents a setback to the USW, the influential union’s opposition has been seen as a key factor in mobilizing political sentiment against the deal ahead of November’s presidential election. President Joe Biden said earlier this year that U.S. Steel should remain American owned and that he “told our steelworkers I have their backs.”
“We’re clearly disappointed with the decision, but it does nothing to change our opposition to the deal or our resolve to fight for our jobs and communities that hang in the balance in this transaction,” the USW said Sept. 25 in a statement on its website.
USW International President David McCall reminds us that our solidarity is our greatest strength as we fight to enforce our contracts – even as U.S. Steel and Nippon pour money into massive PR and lobbying campaigns. Watch now: https://t.co/xrEbEplihp pic.twitter.com/ieZC8G9TO2 — United Steelworkers #EverybodysUnion (@steelworkers) August 12, 2024
The arbitration outcome allows Nippon Steel to focus on addressing political opposition and clearing regulatory obstacles, including a review by the Committee on Foreign Investment in the United States, or Cfius. The company was granted permission to refile Cfius documents, likely pushing a decision on the takeover past the elections in November.
The extension effectively allows Nippon to restart the clock, keeping the proposed transaction alive, even as Biden has vowed that U.S. Steel would remain American owned and is said to be preparing to kill the deal.
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