Biden to block Nippon Steel's $15 billion acquisition of US Steel

A building at Nippon Steel's East Nippon Works Kashima Area facility in Kashima, Ibaraki Prefecture, north of Tokyo, December 6, 2024.

Richard A. Brooks | Afp | Getty Images

US President Joe Biden has decided to block Nippon Steel's $14.9 billion takeover bid for US Steel, the Washington Post reported Friday, citing two unnamed administration officials who were not authorized to comment. express yourself on the subject.

The White House is expected to announce Biden's decision as early as Friday, according to the Washington Post.

The decision on whether to let the deal continue was referred to Biden on Dec. 23 after the Committee on Foreign Investment in the United States failed to reach consensus, U.S. Steel said.

Biden had 15 days to approve or block the transaction after the CFIUS assessment reached his desk, prompting Nippon Steel to extend the transaction deadline to the first quarter of 2025, from the third or fourth quarter of 2024 .

CFIUS was concerned that after the acquisition, Nippon Steel could reduce US Steel's production capacity, which would pose a risk to United States national security.

“A potential reduction in U.S. Steel production could result in supply shortages and delays that could affect industries critical to national security,” the Washington Post quoted CFIUS as saying in its assessment.

To allay that concern, Nippon Steel on Tuesday offered the U.S. government the chance to veto any cuts in the company's steel production.

Nippon Steel had previously proposed a number of concessions regarding the transaction, such as maintaining US Steel's headquarters in Pittsburgh, Pennsylvania, and appointing US citizens to US Steel's board of directors.

The deal was supported by US Steel shareholders, who voted to pass it in April.

“The overwhelming support from our shareholders is a clear testament that they recognize the compelling rationale for our transaction with NSC,” said David B. Burritt, President and CEO of US Steel.

But those factors weren't enough to sway Biden, who has long publicly opposed the deal. In March, Biden issued an official statement saying that “it is vital to [U.S. Steel] remain a nationally owned and operated American steel company.

US President-elect Donald Trump has also expressed resistance to the proposed acquisition of Nippon Steel.

“I am completely against the takeover of the once great and powerful US Steel by a foreign company, namely Nippon Steel of Japan,” Trump said in a post on his social media platform Truth Social on December 2.

Shares of Nippon Steel, listed in Japan, were up 1.2% as of 1 a.m. Eastern time.

CNBC's Lee Ying Shan contributed to this report.

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