Nippon Steel and U.S. Steel: The Steel Giant Arena in Court

The Biden administration's decision to delay the enforcement of its order concerning the mega-acquisition of Nippon Steel over U.S. Steel, valued at $14.9 billion, provides a surprising turnaround in the steel arena. The acquisition was originally blocked on January 3 by President Joe Biden due to national security concerns, after the Committee on Foreign Investment in the United States (CFIUS), led by Treasury Secretary Janet Yellen, had scrutinized the deal intensively. The postponement now offers the courts the opportunity to examine a legal challenge to Biden's order, which was initiated by the companies involved earlier in the month. Originally, the parties had 30 days to complete their transaction, but thanks to the extension until June 18, 2025, both corporations hope to finalize the acquisition successfully. In a joint statement, both companies expressed their satisfaction with the granted delay, emphasizing that this step would secure the best future for the American steel industry and all involved parties. They also called for an impartial review of the CFIUS process in a lawsuit on Monday, as they believe it was distorted by Biden’s persistent opposition to the acquisition. The goal: a renewed review and another chance to complete the merger. The CFIUS panel, which examines foreign company acquisitions regarding national security aspects, had not issued a unanimous recommendation to the President regarding the steel giant deal, ultimately leaving the decision to Biden. Remarkably, both Biden and his successor Trump were officially against the acquisition of the American steelmaker by the Japanese company ahead of the November election, as they sought the support of union voters. CFIUS generally shows less resistance to deals involving member states of the Group of Seven, which includes Japan.