Biden administration gives Nippon Steel more time to make case for purchase of US Steel
CNN
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Nippon Steel is expected to re-file its application for a national security review by American regulators of its $15 billion takeover bid of US Steel, sources familiar with the matter told CNN on Tuesday, buying Japan's largest steelmaker an additional 90 days to close its acquisition of an American rival after political opposition emerged in an election year.
The surprise development allows the steelmakers to reset the clock, potentially keeping the controversial deal alive. However, there is still significant political pushback. President Joe Biden, Republican presidential nominee Donald Trump and Democratic nominee Vice President Kamala Harris have all voiced opposition to the deal.
The Committee on Foreign Investment in the United States (CFIUS), a team of Cabinet-level appointees that reviews all deals of a certain size involving US entities, has been studying the takeover of Pittsburgh-based US Steel for several months on the grounds of national security.
With the White House signaling it would block the deal, and CFIUS officials wanting to operate outside the pressure of political calendars, an extension of the timeline seemed the best outcome, according to two separate sources.
A spokesperson for the Tokyo-based company declined to comment. A spokesperson for the Pittsburgh-based US Steel did not respond to a request for comment.
The proposed takeover has become a political hot potato. Multiple Rust Belt Democrats are also against the deal, including Sen. Sherrod Brown of Ohio and Sen. John Fetterman of Pennsylvania. The United Steelworkers union, which has endorsed Harris for president, has also been a leading opponent of the acquisition.
Earlier this month, US Steel said it would be forced to lay off workers and shutter mills without Nippon's backing. Japanese Prime Minister Fumio Kishida told reporters during a White House visit in April that the legal reviews would determine the deal's outcome.
Several business groups sent a letter last week to Treasury Secretary Janet Yellen, warning of the risks of politicizing a process that was created to study national security risks on their merits.
US Steel put itself up for sale in 2023 after receiving an unsolicited $7 billion takeover offer from Ohio-based Cleveland Cliffs. The $14.9 billion deal with Nippon Steel, Japan's largest steelmaker, resulted from that sale process.
