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Biden Administration Gives Japanese Steelmaker More Time to Make Case for Controversial Deal

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Nippon Steel, Japan’s largest steelmaker, has been granted an additional 90 days to re-file its application for a national security review of its $15 billion takeover bid of US Steel. This extension comes as political opposition mounts during an election year, with President Joe Biden, former President Donald Trump, and Vice President Kamala Harris all voicing opposition to the deal.

The Committee on Foreign Investment in the United States (CFIUS) has been reviewing the acquisition of Pittsburgh-based US Steel for months, citing national security concerns. Given the White House’s indications that it would block the deal and CFIUS officials wanting to avoid political pressures, the decision to extend the timeline seemed the best option.

The takeover has become a contentious issue, with Rust Belt Democrats such as Sen. Sherrod Brown of Ohio and Sen. John Fetterman of Pennsylvania also opposing the deal. The United Steelworkers union, which has endorsed Harris for president, has been a vocal critic of the acquisition.

US Steel has warned that, without Nippon Steel’s support, it could face layoffs and mill closures. The sale process for US Steel began in 2023, following an unsolicited $7 billion offer from Cleveland Cliffs. Nippon’s $14.9 billion bid emerged as the preferred option. Japanese Prime Minister Fumio Kishida previously indicated that the legal reviews would determine the deal’s outcome.

Business groups have expressed concern over the politicization of the CFIUS process, urging Treasury Secretary Janet Yellen to ensure national security risks are evaluated on their merits.

 

Exclusive: US Warns Nippon Steel Bid for U.S. Steel Poses National Security Risk

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The Biden administration, through the Committee on Foreign Investment in the United States (CFIUS), warned Nippon Steel that its $14.9 billion acquisition of U.S. Steel poses a national security threat by potentially weakening the American steel industry. Both Democrats and Republicans have voiced opposition to the deal, with Vice President Kamala Harris and former President Donald Trump expressing strong desires to keep U.S. Steel under American ownership. In a letter sent to the companies, CFIUS highlighted concerns that the transaction would harm U.S. steel production and diminish efforts to seek trade remedies. In their response, the companies warned that rejecting the deal could lead to the idling of U.S. Steel’s blast furnace facilities, result in thousands of job losses, and ultimately weaken the U.S. steel supply chain. While Nippon Steel and U.S. Steel maintain that the deal would strengthen the industry and pose no security risks, political pressures and economic concerns are at the heart of the debate, as the companies consider their legal options to move forward.

 

Harris Courts Union Workers in Key Swing States with Biden’s Support Amid U.S. Steel Controversy

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On Labor Day, Kamala Harris joined President Joe Biden at a rally in Pittsburgh, aiming to solidify support from union workers in critical battleground states like Pennsylvania and Michigan. The event marked the first joint appearance of Harris and Biden since she officially became the Democratic presidential nominee, underscoring the importance of courting working-class voters, a key demographic also being targeted by her opponent, Donald Trump.

Harris voiced concerns over the potential acquisition of U.S. Steel by Japan’s Nippon Steel, stressing the importance of keeping the historic American company under domestic ownership. “U.S. Steel should remain American-owned and American-operated,” she said, aligning her stance with Biden’s pro-union agenda, which has been central to his presidency.

The labor vote remains a pivotal focus for both the Harris and Trump campaigns as they vie for support in swing states like Pennsylvania, where unionized workers hold significant influence. Trump, who did not make any public appearances on Labor Day, has similarly opposed the U.S. Steel deal, framing it as a threat to American jobs and security. The Harris campaign, however, seized the opportunity to mock Trump for his absence, posting on X that he was likely “golfing.”

Despite a Reuters/Ipsos poll showing Harris leading Trump by a slim margin nationally, the race remains tight, with both candidates ramping up their outreach efforts. While Harris is leveraging her campaign to maintain the momentum from her nomination, Trump continues to attract blue-collar voters with his promises of economic nationalism and job protection.

The backdrop of the Gaza conflict, however, loomed over campaign activities. As Harris and Biden met with U.S. hostage negotiation teams in Washington, their administration faced criticism for its approach to the Gaza ceasefire negotiations. Pro-Palestinian activists, opposing U.S. support for Israel, staged large protests, raising the potential for more demonstrations along Harris’s campaign trail in the weeks ahead.

With both campaigns seeking to capture the labor vote while navigating the complexities of international conflicts, the election remains fraught with challenges that could sway voters in unexpected ways.