President Joe Biden is calling for “serious scrutiny” of the planned acquisition of U.S. Steel by Japan’s Nippon Steel, according to the White House. The transaction, valued at approximately $14.1 billion, has raised concerns, particularly from the United Steelworkers International union and political allies in Pennsylvania. The Committee on Foreign Investment in the United States (CFIUS), which reviews deals between U.S. firms and foreign investors for national security risks, will likely conduct an investigation. Biden’s National Economic Council Director, Lael Brainard, stated that the purchase by a foreign entity, even from a close ally, warrants careful examination.
The union, which endorsed Biden in the 2020 election, opposes the acquisition, emphasizing concerns about the impact on the U.S. supply chain and national security. The CFIUS, chaired by Treasury Secretary Janet Yellen, has expanded powers following the Foreign Investment Risk Review Modernization Act in 2018. President Biden’s executive order in September 2022 broadened the factors considered during reviews, such as the impact on the U.S. supply chain and risks to sensitive personal data. The CFIUS has the authority to block deals or request modifications to address national security concerns.
Political figures in Pennsylvania have voiced objections to the sale, characterizing it as detrimental to workers and an example of profit-driven decisions at the expense of American employees. The acquisition could make the combined company one of the top three steel-producing companies globally. The CFIUS is expected to conduct a thorough review, considering factors related to national security and supply chain reliability, with the Biden administration prepared to act if deemed appropriate.