On Friday, shortly before United States Steel shareholders voted to sell the Pittsburgh-based company to Japan’s Nippon Steel, Cleveland-Cliffs CEO Lourenco Goncalves expressed his opinion about the upcoming vote to a room full of steelworkers at his Butler Works plant.
He also expressed his opinion about shareholders having control over not only the workers but also the community, and even the country. He mentioned that these shareholders no longer have any emotional connection to any of these three entities.
He criticized U.S. Steel CEO Dave Burritt for turning down Cleveland-Cliffs’s offer to buy the company for $7.3 billion in July. This deal would have created one of the largest steelmakers globally, second only to China.
“I am frustrated with Dave Burritt, the board of U.S. Steel, and those who believe the company’s headquarters will be in Pittsburgh.” “Well, that’s not true,” he said.
The CEO is based in Peoria, Illinois. The Chief Financial Officer (CFO) is based in Connecticut. The general council is based in Florida. There is no one in that building. Everyone is working from home. “Once we are in charge, there will be more people in that building than there are currently,” he stated.
His feelings, although he expressed them in a more colorful way than others, are not unique. The United Steelworkers, President Joe Biden, and former President Donald Trump are against it. Local members of Congress and their opponents also oppose it. Actually, it seems that only two groups of people support the $14.1 billion deal: the shareholders of U.S. Steel and Nippon Steel.
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Following the vote by the shareholders, Burritt stated that the transaction is the best way forward for both union and non-union employees, customers, communities, and stockholders. Burritt mentioned that under Nippon ownership, the Japanese company plans to keep the U.S. Steel name and continue operating from the Pittsburgh headquarters.
The United Steelworkers union released a statement about the vote. They said that they were not surprised that the stockholders decided to sell the company, which will affect the employees, retirees, and the communities where they live and work. “Wall Street investors and U.S. Steel executives will benefit the most from Nippon, while union members will not benefit,” it continued.
The union stated that the sale is not solely determined by shareholders and executives, and their viewpoint is valid. The approval must come from the Committee on Foreign Investment in the United States, which is a committee in the Biden administration. This committee includes several members of the Cabinet, such as the attorney general, secretaries of commerce, defense, homeland security, treasury, and state. It also needs to be approved by the Justice Department.
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“The idea that shareholders are the most important or that I work solely for them is not something I believe in. You all know me, I don’t work exclusively for the shareholders.” Please write that down. I am not employed by the shareholders. Goncalves said that he only works for people who, like him, are committed to the company in the long term. He was speaking to about 100 steelworkers from UAW Local 3303 who produce grain-oriented steel, which is crucial for making transformers in the country’s electrical grid.
“A deal is not finalized until it is closed.” “It’s just an unrealistic idea,” said Goncalves, whose company is based in Cleveland and has the support of the union. “They made a mistake by messing with the wrong people,” he continued. “They angered Lourenco Goncalves, and they angered the union,” he said, referring to the desires of the United Steelworkers.
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