Nippon Steel, USW poised to meet

As initially reported in late February, negotiations between the United Steelworkers (USW) labor union and executives from Nippon Steel Corp., the intended buyer United States Steel Corp., may occur soon.

Reuters says it has learned directly from a Nippon Steel executive that the Japanese company is seeking a meeting with USW leaders this month with the goal of receiving the union’s acceptance of the transaction by the end of September.

Nippon Steel and U.S. Steel announced the proposed acquisition last December. Subsequently, a handful of elected officials in the U.S. have expressed opposition to the deal, ostensibly for national security reasons. That argument has met with some skepticism since Japan has been allied diplomatically with the United States since 1946.

Prior to the Nippon Steel announcement, Cleveland-Cliffs had publicly acknowledged bidding for U.S. Steel, with Cliffs CEO Lourenco Goncalves saying the USW’s backing of his bid should be the decisive factor.

However, that potential combination also had its critics, particularly from steel buyers concerned the merger would place every blast furnace/basic oxygen furnace steel mill in the U.S. in the hands of one company.

Now, Reuters says it is Nippon Steel’s turn to gain an endorsement from the USW, in a move it says could help the world’s fourth-largest steelmaker "carry the $14.9 billion purchase of its U.S. rival over the line.”

In an earlier interview with Reuters, an executive vice president of Nippon Steel said the firm likely had cleared the contractual issues with the union and that “heart-to-heart talks” still remained to review any concerns about job security and the viability of any mills.

According to Yuka Obayashi and Ritsuko Shimizu of Reuters, Nippon Steel has been seeking the progress with the USW so it would be in front of a U.S. Steel shareholder vote on the merger that could occur in April.

The company’s goal remains to finalize the transaction between June and September, Reuters says.