The merger between US Steel and its Japanese rival is facing scrutiny amid potential national security concerns, with the Committee on Foreign Investment in the United States expected to make a recommendation to the White House after the upcoming election. The decision has been delayed to avoid political pressure during the election cycle, as all political parties have shown opposition to the deal. President Joe Biden holds the ultimate decision power and had indicated that he might block the deal if there was no consensus from the committee.
US Steel’s share price saw a significant increase following reports that the White House does not plan to immediately block the merger. The company had previously warned of potential layoffs and mill closures without the backing of Nippon Steel. The upcoming meeting between President Biden and Japanese Prime Minister Fumio Kishida may further impact the decision-making process regarding the deal. Business groups have expressed concerns about the politicization of the national security review process, urging Treasury Secretary Janet Yellen to avoid allowing politics to interfere with the committee’s work.
Political figures from both parties, including Vice President Kamala Harris, former President Donald Trump, and several Rust Belt Democrats, have expressed opposition to the sale of US Steel to Nippon Steel. The deal originated from a sales process initiated by US Steel after receiving a takeover offer from Cleveland Cliffs. The White House has stated that it will wait for the committee’s recommendation before making a decision, emphasizing the importance of US Steel remaining domestically owned and operated.
White House spokesperson Saloni Sharma reiterated Biden’s stance on the importance of US Steel remaining American-owned and operated, emphasizing that a decision on the merger could not have been imminent without a recommendation from CFIUS. Pennsylvania Governor Josh Shapiro has been involved in discussions with workers, the private sector, and the Biden administration regarding the deal, cautioning against irresponsible political rhetoric and threats against workers in Western Pennsylvania. The final decision on the merger is pending the recommendation from the national security review committee.
