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This photo taken on February 16, 2024 shows a logo of Nippon Steel Corp. in the company’s Kyushu manufacturing base in the city of Kitakyushu in Fukuoka Prefecture. U.S. President Joe Biden plans to voice his concern over Nippon Steel’s proposed $14.9 billion purchase of U.S. Steel, a person familiar with the matter said on Wednesday, pushing up the company’s stock. US company down almost 13% on bets that the deal could face greater political opposition.
Philip Fong | Afp | Getty Images
of Japan Nippon Steel The CEO reiterated on Tuesday that the company was not giving up on its takeover US Steela day after he sued the Joe Biden administration to block the proposed merger.
US Steel and Nippon Steel announced on Monday that they had started two lawsuits after the Biden administration’s decision to block the $14.9 billion acquisition of American steelmaker Nippon Steel.
In a statement accompanying the lawsuits, the two companies said they remained confident the deal was “the best path to secure the future of US Steel” and emphasized their right to pursue the merger.
In a press conference Tuesday, Nippon Steel President and CEO Eiji Hashimoto doubled down on that position.
“There is no reason or need to give up (the takeover). We can’t just accept it,” said Hashimoto to the press conference.
According to the translation of Reuters, Hashimoto emphasized that he never gave up on the expansion of operations in the United States, and did not consider any alternative plan outside the current search of the company of US Steel.
last friday, Biden has officially blocked it Nippon Steel of Japan since the acquisition of US Steel, fulfilling its promise to maintain an industrial name that is more than a century under the ownership of the United States.
The shares of Nippon Steel from a year ago
Both companies approached federal court to overturn Biden’s decision.
In a statement released Monday, both parties said Biden influenced the decision of the Committee on Foreign Investment in the United States, or CFIUS, which evaluates foreign investments for potential threats to national security, and violated the companies’ right to an impartial review.
“As a result of President Biden’s undue influence to advance his political agenda, the Committee on Foreign Investment in the United States (“CFIUS” or “Committee”) has not conducted a regulatory review process of good faith, focused on national security.” the companies said.
The White House did not immediately respond to CNBC’s request for comment.
Hashimoto added that Nippon Steel will explain to the new US administration how the acquisition will strengthen US Steel, as well as the wider US industry.
The incoming president Donald Trump he also has he promised to block it Nippon Steel’s planned purchase of US Steel on various occasions.
The real reason for the collapse of the Nippon Steel/US Steel merger is mainly political.
“Why would they want to sell US Steel now when the tariffs make it a much more profitable and valuable company?” Trump posted on his social media platform Truth Social on Monday
“The real reason for the collapse of the Nippon Steel/US Steel merger is mainly political,” CreditSights analysts said in a report after the proceedings, emphasizing that the timing of the transaction had been “unfavourable” for Nippon Steel given how it unfolded during the presidential election year.
The research firm also maintained that while CFIUS expressed some reservations, it did not offer a formal recommendation on whether the acquisition should proceed or not.
Last week, Nippon Steel had proposed to give the US government veto power over any reduction in US Steel’s production capacity.
Shares of Nippon Steel fell 1.74% during Japanese trading hours.
