(Bloomberg) -- On the final day of his election campaign, Donald Trump stood on stage in Pittsburgh flanked by steelworkers and promised to protect American jobs and manufacturing. Curiously absent from his speech was his often-repeated promise to kill the sale of United States Steel Corp. to Nippon Steel Corp.
The president-elect remains mum on the deal just as a top Nippon Steel executive readies a trip to Pittsburgh to persuade rank-and-file union members and politicians to support the $14.1 billion acquisition of the iconic American company.
Backing the deal would go against Trump’s campaign rhetoric, but the transaction has grown increasingly controversial among some steelworkers who represented critical working-class voters he had courted to win the crucial battleground state of Pennsylvania.
“I told him, ‘I need one thing from you. I need you not to say you’re going to kill the deal on national television and in front of a couple thousand steelworkers you’re here for,’” United Steelworkers Local 2227 Vice President Jason Zugai said in an interview this week. “And he said, ‘OK.’”
The conversation, Zugai said, occurred backstage after Trump wrapped up his rally. He spoke with the then-candidate about the deal and told him many steelworkers supported it.
Zugai said Trump told him he was still worried about selling US Steel to a foreign company, but Zugai responded the deal would fulfill one of Trump’s promises to get foreign investment into the US, and that steelworkers needed it to keep their jobs.
“I told him, ‘You have to know your audience,’” Zugai said. “These are their livelihoods.”
Trump dashed off to one last rally in Michigan, where he didn’t mention the deal, and since his victory hasn’t spoken publicly about it. The Trump transition team did not respond to a request for comment.
There has been a growing public break among some rank-and-file members with the union leadership that has opposed the deal since December. Members, like Zugai, have argued USW International President David McCall should sit down with Nippon Steel executives and negotiate more concessions to get the deal over the finish line, like an extended labor contract.
McCall said this week in a statement he has told Nippon Steel Executive Vice President Takahiro Mori he would meet with company officials if they offered a written contract guaranteeing capital investments.
Following news of Mori’s visit, McCall wrote directly to union members late Thursday warning them the executive “wants to turn us against each other.” McCall said Mori’s only goal is to close the transaction, not to preserve jobs and the US steel industry.
“We have engaged with stakeholders, including employees, to share our vision for US Steel, provide reassurances about the future, and answer any questions they may have,” Nippon Steel said Thursday in an emailed statement.
Both companies are awaiting a decision about the transaction from the Committee on Foreign Investment in the US, or CFIUS. Earlier this year, the panel granted Nippon Steel permission to refile plans for the purchase.
A decision on the deal may never reach Trump’s desk, as the CFIUS decision timeline has been pushed to December, while President Joe Biden is still in office. He has vowed US Steel would remain American-owned.
--With assistance from Hadriana Lowenkron.
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