Language : 
HomeToday’s News
The Biden administration is preparing to announce that President Joe Biden will block Nippon Steel’s USD 14.9 billion acquisition of U.S. Steel due to national security concerns, according to sources familiar with the matter.
The decision, expected as early as this week, comes amid increasing bipartisan opposition to the deal and could strain relations with Japan, a key U.S. ally.
Image Source: CNBC
U.S. Steel has warned that without a deal with Japan-based Nippon Steel, thousands of U.S. union jobs could be at risk. The company has also hinted at the possibility of closing some of its steel mills and relocating its headquarters out of Pennsylvania, a state critical to the upcoming 2024 presidential election.
Both Nippon Steel and U.S. Steel have stated they have not received any updates from the Committee on Foreign Investment in the United States (CFIUS) about the deal and maintain that it does not pose any national security threats.
Image Source: Business Standard
The acquisition has drawn criticism from both Democrats and Republicans. Vice President Kamala Harris, who is running for president, and Republican candidate Donald Trump have both voiced strong opposition, emphasizing the need for U.S. Steel to remain under American ownership.
Pennsylvania, a swing state vital for the 2024 election, has become a focal point in this debate, with both candidates frequently addressing the issue there.
While the CFIUS panel has yet to formally recommend a decision to President Biden, the White House has reiterated the president’s view that “American steel companies ought to be American owned.”
In response to the growing opposition, U.S. Steel employees rallied outside the company’s headquarters, urging politicians to consider the potential economic impact and job losses if the deal is blocked.
“We want elected leaders and other key decision makers to recognize the benefits of the deal as well as the unavoidable consequences if the deal fails,” U.S. Steel CEO David Burritt stated.
Nippon Steel has pledged to invest over USD 2.7 billion in unionized facilities in Pennsylvania and Indiana if the acquisition proceeds. However, U.S. Steel has made it clear that it would not make the same financial commitments if the deal is not approved. The acquisition has already secured all necessary regulatory approvals outside the United States and the backing of U.S. Steel’s shareholders. The final decision now rests with the U.S. regulatory authorities.
Other News
Stocks Drop, Safe Havens Rise Amid Growth Worries
Global stocks fell, while safe-haven assets like U.S. Treasuries and the yen gained, driven by concerns over slowing economic growth. Oil prices also dropped on weak demand outlooks.
U.K. Banks Brace for Potential Tax Hike Under Labour
U.K. banks are ramping up lobbying against a potential tax increase in the Labour government’s upcoming budget, fearing they may be targeted to boost public finances.
Blackstone Acquires AirTrunk in USD 16 Billion Deal
Blackstone, with CPP Investments, will acquire Australian data center firm AirTrunk for AUD 24 billion (USD 16.1 billion), driven by rising AI-driven digital infrastructure demand.
Risk Disclosure:
Securities, Futures, CFDs and other financial products involve high risks due to the fluctuation in the value and prices of the underlying financial instruments. Due to the adverse and unpredictable market movements, large losses exceeding your initial investment could incur within a short period of time.
Please make sure you fully understand the risks of trading with the respective financial instrument before engaging in any transactions with us. You should seek independent professional advice if you do not understand the risks explained herein.
Disclaimer:
This information contained in this blog is for general reference only and is not intended as investment advice, a recommendation, an offer, or an invitation to buy or sell any financial instruments. It does not consider any specific recipient’s investment objectives or financial situation. Past performance references are not reliable indicators of future performance. Doo Prime and its affiliates make no representations or warranties about the accuracy or completeness of this information and accept no liability for any losses or damages resulting from its use or from any investments made based on it.
The above strategies reflect only the analysts’ opinions and are for reference only. They should not be used or considered as the basis for any trading decisions or as an invitation to engage in any transaction. Doo Prime does not guarantee the accuracy or completeness of this report and assumes no responsibility for any losses resulting from the use of this report. Do not rely on this report to replace your independent judgment. The market is risky, and investments should be made with caution.
