US President Joe Biden has blocked the proposed $14.9 billion acquisition of US Steel by Japan’s Nippon Steel, citing national security concerns. The deal was announced in December and sparked opposition from both Trump and Biden, who vowed to block it ahead of the November presidential election.
Biden stated that a strong domestically owned and operated steel industry represents an essential national security priority and is critical for resilient supply chains. He added that without domestic steel production and domestic steel workers, the nation is less strong and less secure.
Nippon Steel had made concessions, including offering to move its US headquarters to Pittsburgh and promising to honor all agreements in place between US Steel and the USW. However, Biden’s decision was met with criticism from Nippon Steel and U.S. Steel CEO David Burritt, who termed it “shameful and corrupt.”
The United Steelworkers union praised Biden’s decision, saying it is the right move for national security. White House spokesperson John Kirby defended the decision, stating that it is about US steelmaking and keeping one of the largest steel producers in the US as an American-owned company.
Nippon Steel faces a $565 million penalty payment to U.S. Steel following the deal’s collapse. The acquisition would have increased Nippon Steel’s global output capacity to 85 million metric tons, but Biden’s decision has dealt a potentially fatal blow to the contentious plan.
The Committee on Foreign Investment in the US had reviewed the deal for national security risks and referred it to Biden, who then blocked the sale. It is unclear whether another buyer will emerge, given U.S.-based Cleveland-Cliffs’ recent acquisition of US Steel’s rival, Cliffs Natural Resources.
Source: https://www.reuters.com/markets/deals/biden-reveal-decision-us-steel-acquisition-early-friday-cbs-news-reports-2025-01-03