Source: AFP
US Steel Corp and potential buyer Japan’s Nippon Steel are seeking a federal review of their proposed deal after congressional criticism that the transaction threatens US national security, US Steel said on Thursday.
The companies asked the Committee on Foreign Investment in the United States — an interagency body established to review foreign acquisitions of American companies — to evaluate Nippon’s $14.1 billion acquisition of Pittsburgh-based US Steel.
“We look forward to a successful review,” said a statement from US Steel’s press office.
“Japan is an important ally of the United States,” US Steel said. “This is a very positive development for American steel, American jobs and America’s national security.”
In unveiling the transaction on Monday, the companies portrayed the deal as a marriage of industry-leading technology holders that would boost steel production and accelerate efforts to decarbonize.
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The combined company also promised to honor contracts between US Steel and the United Steelworkers (USW) union.
However, the USW blasted the proposed deal as a reflection of a “greedy, short-sighted attitude” by US Steel that dates back to 1901, and questioned Nippon’s ability to honor contracts.
The deal also drew bipartisan outcry on Capitol Hill, with Pennsylvania Democratic Sen. John Fetterman calling the deal “absolutely outrageous,” adding that “steel is always about security, too.”
Ohio Sen. JD Vance and two other Republicans asked Treasury Secretary Janet Yellen, who chairs CFIUS, to block the deal, calling domestic steel production “vital to US national security.”
A Treasury spokesman declined to comment.
CFIUS is required to complete a review of a transaction within 45 days. The committee can then open an investigation for up to another 45 days.
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The committee can then approve the transaction, require mitigation measures to address national security concerns, or refer the transaction to the president if it determines the deal should be blocked.
Source: AFP