President Joe Biden has halted Japanese steelmaker Nippon Steel’s planned acquisition of U.S. Steel due to national security concerns.
On Friday, the Biden administration issued an order prohibiting the proposed takeover of the American steel company. The order referenced a report from the Committee on Foreign Investment in the United States, which assessed that the acquisition could likely lead to a decline in domestic steel production, posing “risks to the national security of the United States.”
The decision comes despite Nippon Steel’s final offer in December, which included giving the U.S. government veto powers to alleviate concerns about U.S. Steel’s possible reduction in production capacity.
In response, both Nippon Steel and U.S. Steel criticized the White House’s action as politically motivated and pledged to take legal action against the government for perceived interference. “The president’s statement and order do not present any credible evidence of a national security issue, making clear that this was a political decision. Following President Biden’s decision, we are left with no choice but to take all appropriate action to protect our legal rights,” the companies said in a joint announcement.