President Joe Biden has blocked Nippon Steel’s $15 billion acquisition of U.S. Steel (X), citing potential risks to national security from placing one of the U.S.’s biggest steel companies under foreign control.
“It is my solemn responsibility as President to ensure that, now and long into the future, America has a strong domestically owned and operated steel industry that can continue to power our national sources of strength at home and abroad; and it is a fulfillment of that responsibility to block foreign ownership of this vital American company,” Biden said in a statement on Friday.
His opposition to the deal had been expected, although the result was certainly not what either company had hoped for. In March 2024, Biden said it was “vital” that U.S. Steel remained domestically owned and operated.
It’s also a rare case where both Biden and Republican President-elect Donald Trump are in agreement. In early December, Trump wrote on Truth Social that he would block the deal and instead rely on tax incentives and tariffs to make U.S. Steel “strong and great again.” In his Friday statement, Biden highlighted his tariffs on steel imports from China and investments in domestic manufacturing.
The United Steelworkers union had also raised concerns over Nippon Steel’s acquisition, reiterating on Tuesday that it believes the deal fails to commit to sustaining long-term production.
“U.S. Steel will remain a proud American company – one that’s American-owned, American-operated, by American union steelworkers – the best in the world,” Biden said.
In the days leading up to Biden’s deadline to make a decision on the deal, Nippon Steel and U.S. Steel had attempted to win over the president. On Monday, they proposed giving the U.S. government a veto over any reduction in “production capacity.”
Nippon Steel President Tadashi Iwai has claimed that the company’s deal is being supported in regions of the U.S. where steel mills are located, while U.S. Steel has said more than 2,000 people wrote to the White House supporting the merger. In September, Nippon Steel upped its planned investments in the company by $1.3 billion, taking its total to $2.7 billion, as it plans to revitalize U.S. Steel’s largest facilities.
U.S. Steel CEO David Burritt has said that the acquisition would save thousands of jobs and allow the company to make investments in its older mills.
“We wouldn’t do that if the deal falls through,” Burritt told The Wall Street Journal (NWSA) in September. “I don’t have the money.”
Biden’s block gives Nippon Steel and U.S. Steel 30 days to abandon their proposed merger and provide notice when they have completed their permanent cancellation of the plans.
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