Japan’s largest steelmaker, Nippon Steel (5401.T), announced on Thursday its plans to invest an additional $1.3 billion in two U.S. Steel (X.N) mills as part of its ongoing acquisition of the American company. This new investment comes on top of the previously pledged $1.4 billion investment plan, which extends through 2026. According to a company spokesperson, some of the new expenditures are expected to occur beyond 2027.
The fresh spending plan includes at least $1 billion aimed at increasing the capacity for high-grade steel at Mon Valley Works in Pennsylvania and $300 million to upgrade facilities at Gary Works in Indiana to extend its production life, Nippon Steel said.
Nippon Steel secured a $14.9 billion deal to acquire U.S. Steel last December and has already committed to spending at least $1.4 billion on maintenance and other capital investments in U.S. Steel’s existing facilities. However, specific details of these investments have not been disclosed.
Both steelmakers have obtained all necessary regulatory approvals outside the United States for the acquisition but still face political opposition, scrutiny from U.S. regulators, and objections from the United Steelworkers (USW) union, which is concerned that the deal could lead to job losses.
Nippon Steel mentioned that these investments are contingent on the completion of the transaction and the receipt of any necessary regulatory approvals. The company also noted that the detailed design and specifications will be determined through further engineering studies.