This photo taken on February 16, 2024 shows the Nippon Steel Corp logo. at the Kyushu company's production base in Kitakyushu, Fukuoka Prefecture. U.S. President Joe Biden plans to express concern about Nippon Steel's proposed $14.9 billion purchase of U.S. Steel, a person familiar with the matter said Wednesday, pushing the U.S. company's shares down nearly 13% on bets the deal could face greater backlash. political opposition.
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Japan Nippon steel The president repeated on Tuesday that the company does not intend to abandon the acquisition American steela day after she sued Joe Biden's administration for blocking the proposed merger.
U.S. Steel and Nippon Steel announced Monday that they did initiated two court proceedings following the Biden administration's decision to block the $14.9 billion takeover of the American steel producer by Nippon Steel.
In a statement accompanying the lawsuits, both companies expressed confidence that the deal was “the best path to securing the future of US Steel” and emphasized their right to proceed with the merger.
At Tuesday's news conference, Nippon Steel President and CEO Eiji Hashimoto doubled down on that stance.
“There is no reason or need to abandon (the takeover). We simply cannot accept this,” Hashimoto said press conference.
According to Reuters translations, Hashimoto stressed that he will never give up on expanding operations in the US and is not considering any alternative plan beyond the company's current pursuit of US Steel.
Last Friday Biden officially blocked Japanese company Nippon Steel from acquiring US Steel, thus fulfilling its commitment to maintain an industrial name that is more than a century old and owned by the United States.
Nippon Steel shares from a year ago
Both companies asked a federal court to overturn Biden's decision.
In a statement issued on Monday, both sides said Biden influenced the decision of the Committee on Foreign Investment in the US, or CFIUS, which assesses foreign investments for potential threats to national security, and also violated companies' right to impartial inspection.
“As a result of President Biden's undue influence in advancing his policy agenda, the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) failed to conduct a good faith regulatory review process focused on national security,” he added. – the companies reported.
The White House did not immediately respond to CNBC's request for comment.
Hashimoto added that Nippon Steel will explain to the new U.S. administration how the acquisition will strengthen U.S. Steel as well as the broader U.S. industry.
Future President Donald Trump has also he promised to block Planned purchase of US Steel by Nippon Steel on various occasions.
The real reason for the failure of the Nippon Steel/US Steel merger is primarily political.
“Why would they want to sell US Steel now when tariffs will 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 failure of the Nippon Steel/US Steel merger is primarily political,” CreditSights analysts said in a post-lawsuit report, emphasizing that the timing of the deal was “unfavorable” for Nippon Steel given its development during a presidential election year .
The research firm also maintained that while CFIUS expressed some reservations, it did not make a formal recommendation on whether to proceed with the acquisition.
Last week, Nippon Steel proposed to the US government veto power over any reductions in U.S. Steel production capacity.
Nippon Steel shares fell 1.74% during trading hours in Japan.