Nippon Steel to Invest Additional 1.7 Trillion KRW in US Steel Plants

Nippon Steel has decided to invest a total of $1.3 billion (approximately 1.74 trillion KRW) in two steel mills of the American steel company US Steel.

[Image source=AP Yonhap News]

According to the Nihon Keizai Shimbun (Nikkei) on the 29th, Nippon Steel, which is pursuing the acquisition of US Steel, plans to invest at least $1 billion in the installation of new hot rolling facilities and maintenance work at the Mon Valley Steelworks in Pennsylvania. Through this, they plan to operate the steel mill for several decades.

Additionally, Nippon Steel will invest about $300 million in the Gary Steelworks in Indiana to refurbish the 14th blast furnace and extend its operating period by about 20 years.

This announcement is interpreted as an effort to appease the United Steelworkers (USW) and others opposing Nippon Steel’s acquisition by revealing a mid- to long-term investment plan for US Steel. Previously, Nippon Steel announced in December last year that it would acquire US Steel and secured approval at the shareholders' meeting, but it is currently facing difficulties due to opposition from U.S. politicians and steel labor unions. The company plans to complete the acquisition within this year.

Mori Takahiro, Vice Chairman of Nippon Steel, said, "We are pleased to contribute to growth and development over several generations for all stakeholders and the U.S. steel industry." Nikkei reported that some parts of the investment plan disclosed on this day may overlap with the $1.4 billion investment announced in March. At that time, Nippon Steel did not disclose specific details.

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