Two prominent Democratic senators, Elizabeth Warren of Massachusetts and Sherrod Brown of Ohio, have publicly criticized US Steel Corp. CEO David Burritt over his potential $72 million “golden parachute” in the event of a sale to Japan’s Nippon Steel Corp, Bloomberg reports.
This comes as President Joe Biden’s decision on the $14.1 billion takeover hangs in the balance, adding fuel to the ongoing political firestorm surrounding the deal.
Warren and Brown, in a letter to Burritt, expressed concern over the financial incentives offered to the CEO and other US Steel executives in the event of a takeover. These incentives, outlined in a March SEC filing, would be triggered if the executives are terminated following the acquisition.
The senators argued that these payouts “demonstrate a repulsive conflict of interest” where executives could enrich themselves at the expense of US Steel workers. They further alleged that these incentives might be swaying Burritt towards the Nippon Steel bid over potential domestic buyers.
US Steel, while admitting receipt of the letter, refuted the senators’ claims, calling them inaccurate and mischaracterizations. The company maintained that the payouts are standard practice and that the transaction will ultimately benefit both workers and the domestic steel industry.
President Joe Biden wants US Steel to stay domestically owned, but he hasn’t stopped the sale to Japan yet. He said he still feels the same way, but the government has more time to decide, pushing the decision past the election in November. Vice President Harris agrees with Biden but hasn’t promised to block the sale. The Republican candidate, Donald Trump, has said he would stop the sale if he wins the election.
