Featured image courtesy of US Steel’s Facebook

President Biden blocked the $14.9 billion acquisition of US Steel by Japan’s Nippon Steel, citing national security concerns after a year-long review by the Committee on Foreign Investment in the U.S. (CFIUS).

On Dec. 23, CFIUS members informed the president that they had reached an impasse on whether to recommend the deal. Biden had 15 days to reach a decision. A Jan. 3 White House order gives the companies 30 days to abandon the deal unless CFIUS grants an extension, according to a news release.

“We need major U.S. companies representing the major share of U.S. steelmaking capacity to keep leading the fight on behalf of America’s national interests,” Biden said in statement. “As a committee of national security and trade experts across the executive branch determined, this acquisition would place one of America’s largest steel producers under foreign control and create risk for our national security and our critical supply chains.”

In a joint news release, both US Steel and Nippon Steel condemned Biden’s decision, calling it a violation of due process and politically motivated. They argued the merger would have revitalized US Steel’s aging facilities, preserve jobs and strengthen the U.S. steel supply chain.

“Blocking this transaction means denying billions of committed investments to extend the life of US Steel’s aging facilities and putting thousands of good-paying, family-sustaining union jobs at risk,” the companies said in a joint statement on Jan. 3. “In short, we believe that President Biden has sacrificed the future of American steelworkers for his own political agenda.”

The companies vowed to pursue “all appropriate action” to protect their legal rights, believing the partnership would benefit both US Steel and American workers in the long term. Tokyo-based Nippon Steel is obligated to pay US Steel $565 million if the deal falls through.

The acquisition faced immediate opposition when it was announced in December 2023. Biden had opposed it during his campaign, arguing US Steel should stay American-owned to protect national security and jobs, according to a news release. Union leaders shared this concern, fearing foreign control would weaken labor protections.

Former President Trump voiced in early December that he would block the deal as well and would use tax incentives and tariffs to boost US Steel.

To learn more about the blocked acquisition, click here.