Nippon Steel to make further investment in US Steel plants By Reuters

TOKYO (Reuters) – Japan’s biggest steelmaker Nippon Steel said on Thursday it plans to make an additional investment of about $1.3 billion in U.S. Steel’s two plants as part of its ongoing acquisition of American company.

The spending is on top of a $1.4 billion investment plan through 2026 already promised as part of the takeover proposal, a company spokesman said, adding that some of the spending is expected to take place after 2027.

The new spending plan includes at least $1 billion to increase high-grade steel capacity at the Mon Valley Works in Pennsylvania and $0.3 billion to upgrade facilities to extend their life at the Gary Works in Indiana, said Nippon Steel.

Nippon Steel, which struck a $14.9 billion deal to buy US Steel last December, has pledged to spend at least $1.4 billion on maintenance and other capital investments at US Steel’s existing facilities, though details were not disclosed.

Both steelmakers have received all non-US regulatory approvals for the deal, but face political opposition, US regulatory scrutiny and objections from the powerful United Steelworkers (USW) union, which fears the deal could lead to job losses.

The investments are subject to closing the deal and receiving any necessary regulatory approvals, Nippon Steel said, adding that the design and detailed specifications will be determined through further engineering studies.

The world’s fourth-largest steelmaker expects the acquisition deal to close in the second half of 2024.