Biden blocks U.S. Steel takeover by Japan’s Nippon Steel, citing national security

President Joe Biden on Friday officially blocked the takeover US Steel from Japan’s Nippon Steel, making good on its promise to maintain an industrial name that has been under domestic ownership for more than a century.

Biden said the proposed $14.9 billion purchase by Nippon would put one of the largest steel producers in the United States under foreign control, creating a risk to the nation’s critical supply chains.

“Today’s action reflects my unwavering commitment to use all the authority available to me as president to defend the national security of the United States, including ensuring that American companies continue to play a central role in sectors that are critical to our national security,” Biden. he said in a statement.

Shares of US Steel fell nearly 8% in premarket trading on Friday after 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 president had signaled as early as March 2024 that he intended to block the sale of US Steel to Nippon, supporting the United Steelworkers’ opposition to the deal.

Biden’s decision to torpedo the deal highlights a bipartisan swing toward protectionism in the United States, as Democrats and Republicans seek to maintain domestic control of key industries as geopolitical tensions rise 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 rising protectionist tide. Tokyo is central to Washington’s efforts to keep China’s ambitions in the Indo-Pacific region in check.

US Steel and Nippon said the deal is the best way to keep the company competitive, revitalize communities in America’s rust belt, and strengthen national security. US Steel CEO David Burritt had previously warned that the company would likely close plants if the deal fell apart.