Connect with us

Trending Stories

President Biden to express concerns over Japanese firm’s acquisition of U.S. Steel

Photo by Megan Varner/Getty Images.

United States President Joe Biden is expected to voice some concerns tomorrow regarding Nippon Steel’s proposed £14.9 billion purchase of Pittsburgh-based U.S. Steel Corporation, ahead of Japanese Prime Minister Fumio Kishida’s upcoming visit to the White House later next month.

The significance: U.S. Steel selected Japan’s Nippon Steel over domestic rival Cleveland-Cliffs Inc. as it believed its deal would face scrutiny from the Committee on Foreign Investment in the United States (CFIUS) rather than antitrust review by the U.S. Department of Justice.

Should CFIUS oppose the acquisition, its recommendation would go directly to President Biden for a final decision.

Expected comments: According to reports, President Biden is poised to say “U.S. Steel has been an iconic American steel company for over a century, and it is vital for it to remain an American steel company that is domestically owned and operated.”

The bottom line: Biden appears to be appealing to his labour union support base, as the United Steelworkers union (USW) had preferred Cleveland-Cliffs’ bid. However, most experts believe it is unlikely CFIUS will advise Biden to block the transaction given Japan is a key strategic ally of the United States.

USW union criticises $15 billion U.S. Steel-Nippon deal

The United Steelworkers union has strongly condemned U.S. Steel and Nippon Steel’s $15 billion agreement, claiming the firms failed to obtain its approval beforehand.

The significance: The USW’s response sets the stage for potential disputes over the transaction. The union previously stated that its contract with U.S. Steel mandates any prospective acquirer must agree to a new employment deal prior to finalising any sale.

Details: On Monday, Japan-based Nippon Steel announced its proposal to purchase U.S. Steel, a iconic American corporation that powered nationwide industrial growth in the early 1900s but has since become a symbol of industry decline.

However, experts note the transaction may face tough regulatory scrutiny given the buyer is foreign rather than domestic. Antitrust issues are considered unlikely as the firms have minimal overlapping operations in North America. But some believe the deal could be analysed in regards to a non-American company acquiring important U.S. assets.

USW President David McCall criticised the deal as “greedy” and “short-sighted” and vowed to “fully leverage our agreements to ensure that whatever happens next with U.S. Steel, we safeguard good family-supporting jobs we negotiated.”

He added “Neither U.S. Steel nor Nippon Steel contacted our union regarding the deal, which itself violates our partnership arrangement requiring U.S. Steel notify us of a change in control or business conditions. Based on this alone, the USW does not think Nippon understands the full extent of all our agreements, and we are unsure if it has the ability to fulfil our existing contract.”

McCall also targeted U.S. Steel for arranging a transaction to “sell to a foreign-owned business.”

Representatives from U.S. Steel and Nippon Steel did not immediately respond to requests for comment on the USW’s remarks. Whether U.S. Steel can complete this deal remains uncertain given resistance from the USW and potential political controversies, especially in a U.S. Presidential election year.

Analysing Putin’s Nuclear War Rhetoric Amid the Ukraine Crisis


Israeli Strike Obliterates Iranian Consulate in Damascus – Shockwaves Rock Middle East

Trending Stories

The Geopolitics of the Horn of Africa: Competition Over the Red Sea Heats Up

Trending Stories

Systemic Marginalisation Faced by the Arab Isaaq Clan


Senator Schumer’s Criticism of Netanyahu and the Path to Peace

Trending Stories

Putin’s Nuclear Threats: A Dangerous Escalation in Global Tensions

Trending Stories

Europe Must Step Up to Help Ukraine Secure Peace

Trending Stories

Kenya’s Mission to Haiti: An In-depth Analysis of the 1,000-Strong Force’s Preparedness for Intervention


You cannot copy content of this page