WASHINGTON — President Biden has rejected a proposed roughly $15 billion deal for Nippon Steel Corp. to buy Pittsburgh-based U.S. Steel, affirming a pledge in March to block the deal.
“To continue leading the fight on behalf of America’s national interests, we need America’s major companies, which account for a major share of America’s steel production capacity,” Biden said in a statement Friday morning.
His decision comes after the Committee on Foreign Investment in the United States, known as CFIUS, failed to reach an agreement last month on the potential national security risks posed by the deal, giving Biden a 15-day grace period. This comes after the long-awaited report on the merger was sent. to arrive at a final decision.
The commission, chaired by Treasury Secretary Janet Yellen and made up of other Cabinet members, can recommend that the president block the deal, and federal law gives him that authority.
A U.S. official familiar with the matter told The Associated Press last month on condition of anonymity that some federal agencies participating in the panel believe that allowing a Japanese company to acquire a U.S.-owned steelmaker is a national policy. He said he was skeptical that it would pose a security risk.
The decision, made weeks before the Democratic president leaves office, could have a negative impact on U.S. relations with Japan, America’s biggest ally in Asia. Japan is also the largest foreign holder of US government debt.
Biden previously voiced opposition to the deal last March, with support from the United Steelworkers union, which is concerned about whether the company will honor existing labor agreements or cut jobs and financial transparency. was receiving.
Biden, who was seeking reelection as president, said in a statement in March, “It’s important to keep America’s steel companies strong, supported by American steelworkers,” before withdrawing from the campaign. “U.S. Steel has been an iconic American steel company for more than a century, and it is critical that we remain a domestically owned and operated American steel company.”
President-elect Donald Trump has also opposed the takeover, vowing in December on his Truth Social platform to block the takeover and use tax incentives and tariffs to grow the company. Steelworkers Union President David McCall said last month that the union welcomed President Trump’s opposition to the sale, saying, “It’s time to reject this deal so we can all focus on the future.”
Nippon Steel announced plans in December to buy the Pennsylvania steelmaker for $14.1 billion in cash, and despite pledging to keep the U.S. Steel name and Pittsburgh headquarters, the offer does not require unionization. raised concerns about what it means for workers, supply chains and organizations that subscribe to the US national security.
Still, the deal had many supporters, including members of Congress and business groups such as the U.S. Chamber of Commerce. Mike Pompeo, Trump’s first secretary of state, told the Wall Street Journal that the possibility of rejecting the deal was “short-sighted.”
“This transaction will enhance U.S. Steel’s current operations and production capabilities, benefit its employees and its communities, and strengthen the competitiveness of the U.S. steel industry,” he wrote in December. .
Hussein and Bork are contributors to The Associated Press.