The companies filed lawsuits accusing Joe Biden’s administration of ‘illegal interference’ in the transaction worth $14.9 billion.

Le Monde with AP and AFP
 January 6, 2025

Nippon Steel was standing firm on its proposed $15 billion acquisition of US Steel, Chief Executive Eiji Hashimoto said Tuesday, January 7, after President Joe Biden blocked the top Japanese steelmaker’s move.

“There is no reason or need to give up,” he told reporters at company headquarters in Tokyo. “We are convinced it’s clearly beneficial for both nations.” While acknowledging the effort may take time, he stressed the companies’ latest legal action in the US was a key development.

Nippon Steel and US Steel had filed suit on Monday over Biden’s decision to block the Japanese giant’s proposed acquisition of its American rival, accusing his administration of “illegal interference” in the huge transaction. The companies said in a statement that they initiated the legal action in the US Court of Appeals in Washington challenging the review process for the acquisition, claiming Biden, who is leaving office on January 20, had improperly used his influence and blocked the deal “for purely political reasons.”

The companies filed their lawsuits “to remedy the ongoing illegal interference with Nippon Steel’s acquisition of US Steel,” they said, adding that the litigation intends to show that “President Biden ignored the rule of law to gain favor with (workers’ unions) and support his political agenda.”

Biden had criticized the $14.9 billion deal for months, while holding off on a move that could hurt ties with Tokyo. But the outgoing president – who made the rebuilding of the US manufacturing base a major goal of his administration – announced Friday that he was blocking the acquisition, saying it threatened national security.

The companies said the body reviewing the deal, the Committee on Foreign Investment in the United States (CFIUS) “failed to conduct a good faith, national security-focused regulatory review process.” The steelmakers are asking the courts to order a new review of the proposed merger.

On Monday Japanese Prime Minister Shigeru Ishiba urged Washington to dispel concerns that Biden’s block of the deal could impact future investments.

The transaction was a prominent element of the 2024 presidential campaign, given US Steel’s ties to Pennsylvania, a politically critical battleground state and cradle of the American steel industry.

In an interview with the business daily Nikkei, Nippon Steel vice chairman Takahiro Mori said his company “will not back down after being treated unreasonably. We will fight tooth and nail.” The CFIUS review process “lacked integrity,” he said, adding that “the decision was left to the president (Biden) without any substantive consultation” with the companies.

Source: lemonde.fr