News: Biden Prepares to Block Nippon Steel's Acquisition of U.S. Steel

Potential Block of U.S. Steel Sale by Biden

WASHINGTON — President Joe Biden is preparing to announce that he will formally block Nippon Steel’s proposed $14.9 billion acquisition of U.S. Steel, two people familiar with the matter confirmed to NBC News. The storied American firm announced in December that it had agreed to be purchased by the Japanese-owned conglomerate, necessary for U.S. Steel's evolution within a competitive and globalized marketplace.

However, the agreement faced immediate opposition from the Biden administration as it represents a historic blow to U.S. manufacturing capacity and is seen as a national security threat. “U.S. Steel has been an iconic American company for more than a century,” Biden stated in April. “It should remain a totally American company.” He emphasized the significance of American ownership and operations in preserving jobs.

Economic Implications and Job Security

A White House official noted that the Treasury committee reviewing foreign investments in the U.S. has yet to provide Biden with a recommendation regarding the sale. The timing of this recommendation remains uncertain. U.S. Steel executives express that the fallout from the deal failing could jeopardize thousands of union jobs, notably affecting the company’s historic Pittsburgh headquarters.

• Pennsylvania is a critical swing state for upcoming elections.
• Potential loss of jobs could have significant political repercussions.
• U.S. Steel CEO David Burritt urges decision-makers to recognize the deal's benefits and the consequences of its failure.

Once among the largest companies in America, U.S. Steel now employs approximately 20,000 workers, significantly down from its peak of 340,000 in 1943, as reported by the Pittsburgh Post-Gazette. The company's market value was about $7 billion as of Thursday morning. However, Nippon valued the firm at approximately $15 billion, equating it to companies like Snap and Hyatt Hotels.

Although shares of U.S. Steel saw a slight increase, the news of Biden's anticipated blocking of the deal originally caused a decline. Nippon Steel stated that it had not received updates regarding the process but opposed any efforts to disrupt the agreement.