National security watchdog punts $15B steel deal decision to Biden

[Karah]

The fate of Nippon Steel’s 15 billion dollar acquisition of U.S. Steel is in the hands of President Joe Biden less than a month before he leaves office.

The committee on Foreign Investment in the United States, which reviews deals involving foreign entities in the U.S. for national security risks, sent the deal to Biden’s desk after it failed to reach an agreement on its recommendation.

But that shouldn’t come as a surprise to the steel companies. Last week CFIUS sent a letter to Nippon saying…

“The Committee has not yet reached consensus on whether the mitigation measures proposed by the Parties would be effective… or whether they would resolve the risk to U.S. national security arising from the Transaction.”

CFIUS had a deadline of Monday to approve the deal, extend its review or recommend the president.reject the deal.

White House spokesperson Saloni Sharma confirmed the situation to Straight Arrow News Tuesday morning via email saying…

“We received the CFIUS evaluation and the President will review it.” U.S. Steel also confirmed it had been notified of the CFIUS decision.

[John Kirby]

Look, president has said already what he believes that the future of U.S. Steel ought to be. He’s made that clear, but he also respects the CFIUS’s process.

[Karah]

President Biden has reportedly been getting ready to block the deal since September. While he has let the review play out, he’s been pretty clear about his opposition.

Meanwhile, mayors and local leaders from 20 communities that rely on the steel industry wrote a letter to President Biden to express their support for the deal…

“Our communities in the Mon Valley of Pennsylvania as well as Gary, Indiana are made up of working-class American men and women whose identity and livelihood depend on the success of U. S. Steel. As such, they overwhelmingly support the vision and commitments that Nippon Steel has introduced to ensure that their jobs are protected and that their local facilities stay open,” the letter reads.

The letter also claims the United Steelworkers Union, which opposes the deal, hasn’t acted in good faith.

That sentiment from local leaders echoes actions taken in recent weeks to rally support for the deal.

“This represents a path to the middle class. We need this deal.”
“It’s a no lose situation. Time is running out. And this has to get done.”

[Eddie Melton]

We know that in 1906 US Steel founded the city of Gary. And if it was not for that entity, we would not be here today.

we know that in the beginning, 30,000 workers were at US Steel and right in broad now I believe it’s close to 4000 workers. We know that Gary, at its height, had over 200,000 residents, and right now we’re close to 70,000 residents. So Gary has had his fair share of impact of the downturn of the steel industry over the last several decades.

[Karah]

President Biden now has 15 days to review the terms and make a final decision. He can essentially block it or let the clock run out which would effectively approve it.

If past comments are any indication, it doesn’t appear the deal would fare any better under the administration of President-elect Donald Trump.

[Donald Trump]
I will stop Japan from buying United States Steel. We have a foreign country that wants to purchase one of our greatest.

They shouldn’t be allowed to buy it. We have to make it work. Have to make it work. You don’t want to sell U.S. Steel.

[Karah]

If the deal doesn’t get approval. Nippon Steel would be on the hook for a $565 million penalty to U.S. Steel. Nippon has previously said it would sue the U.S. government if the deal fails to be completed.