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A water tower at a US Steel Corp. steel plant. Edgar Thomson Works in Braddock, Pennsylvania on September 4, 2024.
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President Joe Biden on Friday officially blocked the takeover US Steel across Japan Nippon Steelfulfilling its promise to keep the more than a century-old trade name internally owned.
Biden said Nippon’s proposed $14.9 billion acquisition would put one of the largest U.S. steelmakers under foreign control, posing a risk to critical domestic supply chains.
“Today’s actions reflect my unwavering commitment to use all the authority available to me as president to protect the national security of the United States, including by ensuring that American companies continue to play a central role in sectors critical to our national security.” Biden said. the statement said.
After the president’s announcement, shares of US Steel fell by more than 7%. Biden’s action followed a month-long review of the deal by the Committee on Foreign Investment in the United States.
The United Steelworkers union has fiercely opposed the Nippon takeover since the day it was announced in December 2023. Biden gave the signal back in March 2024 that he intended to block the sale by supporting the United Steelworkers’ opposition to the deal.
Biden’s decision to torpedo the deal underscores a bipartisan turn toward protectionism in the U.S., as Democrats and Republicans alike seek to maintain domestic control over key industries as geopolitical tensions rise around the world.
The elected president Donald Trump also opposed the deal.
Biden’s decision to block the sale shows that even staunch allies like Japan are not immune to the rising tide of protectionism. Tokyo is central to Washington’s efforts to contain China’s ambitions in the Indo-Pacific region.
US Steel and Nippon said the deal is the best way to keep the company competitive, revitalize communities in America’s rust belt and strengthen national security. US Steel CEO David Burritt previously warned that the company would likely to close factories if the deal falls through.
US Steel and Nippon Steel did not immediately respond to CNBC’s requests for comment.
