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The building of the Nippon Steel East Nippon Works Kashima Area in Kashima, Ibaraki Prefecture, north of Tokyo, on December 6, 2024.
Richard A. Brooks | Afp | Getty Images
US President Joe Biden decided to block Nippon Steel Company The takeover bid was $14.9 billion US Steel, The Washington Post reported Friday, citing two unnamed administration officials who were not authorized to speak on the subject.
The White House is expected to announce Biden’s decision on Friday, according to The Washington Post.
The decision was to let the deal go ahead referred to Biden On December 23, after the Committee on Foreign Investment in the United States failed to reach a consensus, said US Steel.
Biden had 15 days to approve or block the deal after the CFIUS review landed on his desk, forcing Nippon Steel extend the term of the transaction by the first quarter of 2025 from the third or fourth quarter of 2024.
CFIUS was concerned that the Nippon Steel acquisition could reduce US Steel’s production capacity, posing a risk to the national security of the United States.
“A potential decline in US Steel production could lead to supply shortages and delays that could affect industries critical to national security,” The Washington Post. reported CFIUS stated in its assessment.
To assuage that concern, Nippon Steel on Tuesday offered the U.S. government veto power any cutbacks in the company’s steel production.
Nippon Steel earlier offered a series of concessions regarding the transaction, such as maintaining US Steel’s headquarters in Pittsburgh, Pennsylvania, and staffing US Steel’s board of directors with US nationals.
The deal was supported by US Steel shareholders who voted in April to make it pass.
“The overwhelming support from our shareholders is clear confirmation that they recognize the compelling case for our transaction with NSC,” said US Steel President and CEO David B. Berit.
But those factors weren’t enough to sway Biden, who has long publicly opposed the deal. In March, Biden released Mr official statement saying it is “vital for (US Steel) to remain a domestically owned and operated American steel company.”
US President-elect Donald Trump has also expressed opposition to the proposed acquisition of Nippon Steel.
“I am categorically against the once great and powerful US Steel being acquired by a foreign company, in this case Japan’s Nippon Steel,” Trump said. post on their social media platform Truth Social December 2.
Japan’s Nippon Steel shares were last up 1.2% at 1 a.m. ET.
— CNBC’s Lee Ying Shan contributed to this report.
