Nippon Steel’s USD 15 bln bid to acquire U.S. Steel has been referred to President Joe Biden, who has 15 days to make a decision, according to a White House spokesperson. Biden, who previously expressed opposition to the deal, must now decide after the Committee on Foreign Investment in the United States (CFIUS) failed to reach a consensus, citing national security concerns.
In a statement, U.S. Steel confirmed the referral, noting that CFIUS could not reach an agreement on the transaction and deferred the decision to the president. Should the deal collapse, Nippon Steel will face a USD 565 mln penalty payable to U.S. Steel. The company has hinted at possible legal action against the U.S. government if the bid is blocked.
Nippon Steel’s acquisition is critical to its strategy of increasing global steel production capacity from 65 mln tons to 85 mln tons annually, with a long-term goal of surpassing 100 mln tons. The proposed USD 55-per-share takeover, announced in December 2023, values U.S. Steel at USD 14.9 bln, including assumed debt.
The deal has encountered significant resistance, with the Biden administration extending the foreign security review period and Bloomberg reporting earlier this month that Biden is likely to reject the bid. President-elect Donald Trump also opposes the acquisition, calling it a threat to U.S. interests.
Nippon Steel criticized the political interference, stating it detracts from legitimate national security considerations. The company expressed confidence in the U.S. legal system and pledged to collaborate with U.S. Steel to seek a fair resolution if required.
