Biden Blocks Nippon Steel's US Steel Acquisition... Japanese Government "Regrets"

U.S. President Joe Biden has blocked Nippon Steel's acquisition of the American steel company US Steel, citing concerns that it would weaken national security.

In a statement on the 3rd (local time), President Biden announced the decision to deny the sale of US Steel, saying, "US Steel will remain a proud American company owned by Americans and operated by American steelworkers who are members of labor unions."

President Biden explained, "As determined by the Committee on Foreign Investment in the United States (CFIUS), composed of national security and trade experts across the government, this acquisition would place one of the largest steel producers in the U.S. under foreign control, posing risks to our national security and critical supply chains."

The Committee on Foreign Investment in the United States (CFIUS), under the U.S. Department of the Treasury, reviews foreign investments such as mergers and acquisitions of U.S. companies to assess their impact on national security. If security concerns are identified, CFIUS can require corrective measures or recommend that the president block the transaction.

US Steel Edgar Thomson Plant in Pennsylvania, USA. Photo by Yonhap News

Meanwhile, regarding the U.S. government's decision, the Japanese government expressed that it is "difficult to understand and regrettable."

According to major Japanese media such as Kyodo News and NHK on the 4th, Yoji Muto, Japan's Minister of Economy, Trade and Industry, issued a late-night comment stating, "It is difficult to understand and regrettable that such a decision was made citing national security concerns."

He emphasized, "Voices of strong concern are emerging in the economic sectors of both countries, especially in Japanese industry, and the Japanese government cannot take this lightly. We will demand explanations regarding this decision and responses from the Biden administration to dispel these concerns."

Nippon Steel and US Steel criticized the decision in a joint statement, calling it "clearly a political judgment." The companies added in the statement, "Nippon Steel and US Steel will pursue all measures to protect their legal rights."