U.S. Steel Beats Steelworkers Challenge to $14.1 Billion Nippon Deal

By Dean Seal

United States Steel said an arbitration board has ruled in its favor in a dispute with the United Steelworkers union over its planned $14.1 billion acquisition by Japan's Nippon Steel.

The steelmaker said Wednesday that the arbitration board was satisfied with Nippon's written commitments to invest in union-represented facilities and refrain from layoffs and plant closures, meaning the sides could proceed with the deal without taking any further actions under the union's labor agreement.

United Steelworkers filed a series of grievances earlier this year saying U.S. Steel didn't keep the union informed about acquisition offers and hadn't satisfied the conditions of their labor agreement's successorship clause, which requires the company to maintain benefits, pensions, profit-sharing and other provisions specified in the existing labor deal.

The sides presented evidence and arguments to the jointly selected Board of Arbitration on Aug. 15. The board has now found that the successorship clause was satisfied, as Nippon has provided reasonable assurances that it is willing and financially able to honor commitments in the United Steelworkers labor agreement.

U.S. regulators are still reviewing Nippon's acquisition of U.S. Steel, which top political leaders have vowed to kill. The Committee on Foreign Investment in the U.S. decided last week to allow the companies to resubmit an application for a national security review, meaning the fate of the embattled deal won't be decided until after the November election.

U.S. Steel Chief Executive David Burritt said last week that he was confident that the acquisition will be approved by U.S. regulators.

A representative for the union didn't immediately respond to a request for comment.

Write to Dean Seal at dean.seal@wsj.com

(END) Dow Jones Newswires

September 25, 2024 12:32 ET (16:32 GMT)

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