A water tower at the U.S. Steel Corp. Edgar Thomson Works steel mill in Braddock, Pennsylvania, on Sept. 4, 2024.
Justin Merriman | Bloomberg | Getty Images
President Joe Biden on Friday officially blocked the takeover of U.S. Steel by Japan’s Nippon Steel, making good on his promise to keep an industrial name that is more than a century old under domestic ownership.
Biden said the proposed $14.9 billion acquisition by Nippon would place one of the largest steel producers in the U.S. under foreign control, creating a risk for the nation’s critical supply chains.
“Today’s action reflects my unflinching commitment to utilize all authorities available to me as President to defend U.S. national security, including by ensuring that American companies continue to play a central role in sectors that are critical for our national security,” Biden said in a statement.
U.S. Steel’s stock opened down more than 7% following the president’s announcement. Biden’s action comes after a months-long review of the deal by the Committee on Foreign Investment in the United States.
The United Steelworkers union fiercely opposed the takeover by Nippon from the day it was announced in December 2023. Biden had signaled as early as March 2024 that he intended to block the sale, backing the United Steelworkers’ opposition to the deal.
Biden’s decision to torpedo the deal underscores a bipartisan swing toward protectionism in the U.S., as Democrats and Republicans alike seek to maintain domestic control over key industries as geopolitical tensions escalate around the world.
President-elect Donald Trump also opposed the deal.
Biden’s decision to block the sale shows that even staunch allies like Japan are not immune to the swelling protectionist tide. Tokyo is central to Washington’s efforts to keep China’s ambitions in the Indo-Pacific region in check.
U.S. Steel and Nippon have said the deal is the best way to keep the company competitive, revitalize communities in the American rust belt, and strengthen national security. U.S. Steel CEO David Burritt had previously warned that the company will likely close plants if the deal falls apart.
U.S. Steel and Nippon Steel did not immediately respond to requests from CNBC for comment.
