Nippon Steel Not Giving Up On US Steel Acquisition Despite Biden's Block: CEO

TOKYO, Jan 7 (Bernama-Sputnik/RIA Novosti) - Japanese steelmaker Nippon Steel does not intend to give up the idea of ​​doing business in the United States (US) and acquiring US Steel Corp, despite the decision of US President Joe Biden to block the US$15 billion deal, the Japanese company's chief executive officer Eiji Hashimoto said at a press conference on Tuesday, reported Sputnik/RIA Novosti.

Earlier, Biden blocked the acquisition of US Steel by Nippon Steel, calling it a threat to national security. US Steel CEO David Burritt called Biden's decision to block the deal a disgrace and an act of political corruption.

"By introducing our technologies and products, we will be able to produce steel that is currently insufficiently produced in the US. We believe that this contributes to strengthening America's national security, and therefore we will never give up doing business in the US. I have no reason to give up on this, and this is the agreed point of view of Nippon Steel and US Steel. We will never give up," he emphasised.

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The press conference was broadcast by the NHK television channel.

Hashimoto also noted that the Japanese company was confident that "there is no other way to ensure a positive cycle of growth and distribution in Japan other than by expanding the global revenue network and increasing investment in equipment", and the deal would be beneficial not only for Japan, but also for the US.

Japanese Prime Minister Shigeru Ishiba, in turn, also called on the US leadership to provide detailed explanations of what exactly the threats to national security were that justified the ban on the deal.

The day before, Nippon Steel and US Steel filed two lawsuits in connection with this decision. The first lawsuit, filed in the US Court of Appeals for the District of Columbia Circuit, challenges the violation of constitutional guarantees, as well as "unlawful political influence", and asks the court to overturn Biden's decision.

The second lawsuit was filed in the US District Court for the Western District of Pennsylvania against the management of steel companies Cleveland-Cliffs and USW for their "unlawful and coordinated actions" aimed at preventing the deal.

Nippon Steel officially announced its intention to acquire US Steel for US$14.1 billion in December 2023. As a result of the deal, the American company was to become a subsidiary of the Japanese steel giant. At the same time, the White House said that the acquisition of such an iconic American company by a foreign entity required serious consideration in terms of its possible impact on US national security and supply chain sustainability.

Last spring, US Steel reported that the majority of its shareholders had supported the sale, and in May, the parties announced that they had received regulatory approval for this acquisition outside the US. In late August, Nippon Steel announced its intention to invest US$2.7 billion in US Steel's production facilities in Pennsylvania and Indiana if the contract was signed. In late December, the Committee on Foreign Investment in the US (CFIUS) said it could not reach a consensus on whether the Nippon Steel-US Steel deal would pose a national security threat and left the decision to allow or block it to the discretion of Biden.

In early January, it was reported that Nippon Steel had made a new deal proposal, committing to provide a 10-year guarantee that it would not reduce production capacity at US Steel plants in Pennsylvania, Indiana, Alabama, Texas, California, and Arkansas without approval from a special US Treasury committee. Despite this, Biden blocked the deal on January 3.

-- BERNAMA-SPUTNIK/RIA NOVOSTI