What happened
President Joe Biden has decided to block the $14 billion acquisition of U.S. Steel by Japan's Nippon Steel, citing national security concerns, The Washington Post and The New York Times said Friday morning.
Who said what
Biden's move deals a "probably fatal blow to the contentious merger plan," Reuters said, especially since President-elect Donald Trump has also "vowed to block the deal." Opposition to Nippon Steel's purchase of America's No. 3 steelmaker "blended election-year politics, nostalgia for a vanished era of American industrial supremacy" and competition with China, the Post said. The United Steelworkers union opposed the deal, but some of Biden's senior advisers "warned that rejecting a sizable investment from a top Japanese corporation could damage U.S. relations with Japan," a key ally.
Blocking the deal "would be an extraordinary use of executive power," especially for an outgoing president, the Times said, and the "departure from America's long-established culture of open investment" could have "wide-ranging implications for the U.S. economy."
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What next?
Nippon Steel and U.S. Steel have "vowed to pursue legal action" if the government blocks the deal, the Post said. U.S. Steel could also "resume its search for a buyer," like No. 2 U.S. producer Cleveland Cilffs, or it could "opt to proceed as a stand-alone company."
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