Japan’s premier steel manufacturing company, Nippon Steel, has extended a $14 billion offer to buy US Steel. However, two sources familiar with the matter said that US President Joe Biden is prepared to block the transaction due to national security concerns. As the 2024 US Presidential election campaigning is at its peak, campaigners from both sides of the aisle have vowed to protect American manufacturing.
A White House official said in a statement that the Committee on Foreign Investment in the United States is investigating the proposed merger on grounds of national security and has not yet given its recommendation to Joe Biden. The official also mentioned that the President will not proceed with the deal if there is even a hint of national security concern.
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However, both companies subjected to this merger seem quite optimistic and even ready to fight a legal battle if the President doesn’t approve this deal. US Steel said in a statement, “We continue to stand by the fact that there are no national security issues associated with this transaction, as Japan is one of our most staunch allies. We fully expect to pursue all possible options under the law to ensure this transaction closes.”
On the other hand, Nippon Steel also said that from the beginning of the regulatory review process, Nippon Steel has consistently communicated to the administration that the company do not view this deal as posing any national security risks. Nippon Steel’s investment in US Steel will significantly strengthen both US Steel and the broader American steel industry. The company also said that this is an investment that only Nippon Steel is both willing and capable of making.
