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A logo of Nippon Steel is pictured in Chiyoda Ward, Tokyo on March 15, 2024. US President Joe Biden opposed planned sale of U.S. Steel to Nippon Steel, a Japanese Firm, on March 14th.
Biden expected to block Nippon Steel deal, citing national security
President Biden is expected to block Nippon Steel's $14 billion acquisition of US Steel on national security grounds, with his decision expected as early as Friday. This expansion of executive authority could significantly impact US foreign investment practices and strain relations with Japan, a key ally and major investor in the US.
Background: The Committee on Foreign Investment in the United States expressed concerns that the deal could threaten national security by potentially diminishing American steel production. While CFIUS did not make a formal recommendation, they questioned whether Nippon's global business interests might override their commitments to invest in US Steel.
Nippon Steel has strongly contested these concerns, accusing the White House of overreach in the process and arguing that CFIUS's concerns were based on inaccuracies and unfounded hypotheticals. The Japanese company has threatened to pursue legal action if the deal is blocked. US Steel continues to support the acquisition.
The decision comes after the deal has been swept up in election year politics and marks a departure from America's traditionally open investment environment, potentially affecting future foreign investments in sensitive US industries.