United States Steel logo. File
| Photo Credit: AP
Nippon Steel and U.S. Steel are filing a federal lawsuit challenging the Biden administration’s decision to block a proposed nearly $15 billion deal for Nippon to acquire Pittsburgh-based U.S. Steel.
The suit, filed Monday (January 6, 2025) in the U.S. Court of Appeals for the District of Columbia, alleges that it was a political decision and violated the companies’ due process.
Nippon Steel had promised to invest $2.7 billion in U.S. Steel’s ageing blast furnace operations in Gary, Indiana, and Pennsylvania’s Mon Valley. It also vowed not to reduce production capacity in the United States over the next decade without first getting U.S. government approval.
President Biden on Friday (January 3, 2025) decided to stop the Nippon takeover — after federal regulators deadlocked on whether to approve it — because “a strong domestically owned and operated steel industry represents an essential national security priority. … Without domestic steel production and domestic steelworkers, our nation is less strong and less secure,” he said in a statement.
While administration officials have said the move is unrelated to Japan’s relationship with the U.S. — this is the first time a U.S. president has blocked a merger between a U.S. and Japanese firm.
Mr. Biden departs the White House in just a few weeks.
The president’s decision to block the deal comes after the Committee on Foreign Investment in the United States, known as CFIUS, failed to reach a consensus on the possible national security risks of the deal last month, and sent a long-awaited report on the merger to Mr. Biden. He had 15 days to reach a final decision.
Published – January 06, 2025 07:53 pm IST