(WASHINGTON) — President Joe Biden on Friday announced a decision to block the $14 billion acquisition of U.S. Steel by Japan-based Nippon Steel, saying domestically produced steel is essential to U.S. national security.
“Without domestic steel production and domestic steel workers, our nation is less strong and less secure,” Biden said in a statement.
The move marks the latest effort on the part of the Biden administration to protect U.S. markets from foreign-owned firms.
Biden has preserved many of the tariffs imposed by former President Donald Trump, and he enacted a law that would ban China-based social media platform TikTok later this month if the company doesn’t find a new parent company. The Supreme Court is set to hear arguments this month in a legal challenge brought by TikTok.
Nippon Steel sharply criticized the decision in a statement on Friday, suggesting the company may take legal action.
“We are dismayed by President Biden’s decision to block Nippon Steel’s acquisition of U. S. Steel,” Nippon Steel said. “The President’s statement and Order do not present any credible evidence of a national security issue, making clear that this was a political decision.”
“Following President Biden’s decision, we are left with no choice but to take all appropriate action to protect our legal rights,” the company added.
The decision comes weeks after a federal committee declined to issue a recommendation on the U.S. Steel-Nippon Steel merger, leaving Biden an opportunity to block the deal.
The Committee on Foreign Investment in the United States, tasked with a review of the potential acquisition, shared concerns about the national security risks posed by the loss of the country’s second-largest steel producer.
In response to the committee’s decision, Nippon Steel alleged the White House had “impermissible undue influence” on the review. Nippon Steel has previously threatened to challenge the White House decision in court.
The fate of U.S. Steel – a storied 120-year-old firm based in Pittsburgh, Pennsylvania – became a lightning rod during the 2024 election season.
During the campaign, President-elect Donald Trump repeatedly said he would block the acquisition of U.S. Steel by Nippon. In December, Trump reiterated that position.
“I am totally against the once great and powerful U.S. Steel being bought by a foreign company,” Trump said. “Buyer beware!!!”
In a statement on Friday, Biden said the decision to block the merger reflected a priority placed on the intersection between the nation’s economic and national security interests.
“As I have made clear since day one: I will never hesitate to act to protect the security of this nation and its infrastructure as well as the resilience of its supply chains,” Biden said.
Shares of U.S. Steel fell about 7% in early trading on Friday.
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