Biden Prepares to Oppose Nippon Steel's Acquisition of U.S. Steel Before Japanese PM Visit

On April 10th, President Biden is set to release a statement expressing concerns about Nippon Steel's proposed acquisition of U.S. Steel ahead of Japanese Prime Minister Fumio Kishida's visit to Washington. This move comes as White House lawyers are drafting the statement while the Committee on Foreign Investment in the United States evaluates the proposed takeover.

Public Opposition and Political Concerns

Following a meeting between Nippon Steel executives and representatives of the United Steelworkers Union, it has been publicly revealed that the $14.9 billion deal has faced opposition from both the union and prominent lawmakers from both parties. Notably, former president Donald Trump has also voiced his opposition to the deal, stating that he would "block it instantaneously" if he were to return to the White House.

According to industry sources, administration officials have communicated the president’s plans to the Japanese government, citing the president’s need to maintain political support in Pennsylvania for the upcoming November election.

Scrutiny and Unease

Back in December, Lael Brainard, director of the National Economic Council, emphasized the need for "serious scrutiny" of Nippon Steel’s bid for the American company. This has sparked tension within President Biden’s international economic policy, as the White House had previously celebrated an increase in foreign investment in U.S. factories. However, Nippon Steel's intentions have raised unease, primarily due to domestic political considerations.

Historical Significance of U.S. Steel

U.S. Steel holds a significant place in the nation’s economic history, being the first billion-dollar corporation in the U.S. after its establishment in 1901 through a merger of steel companies. The company played a pivotal role during World War II contributing to the production of essential wartime materials. However, it currently stands as the third-largest steelmaker in the nation by revenue, employing fewer workers than it did two decades ago and facing financial challenges, having incurred losses in nine of the last 15 years.