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This photo, taken on February 16, 2024, shows the logo of Nippon Steel Corporation’s Kyushu manufacturing base in Kitakyushu City, Fukuoka Prefecture. U.S. President Joe Biden plans to express concern about Nippon Steel Corp’s proposed $14.9 billion takeover of U.S. Steel Corp, a person familiar with the matter said on Wednesday, sending the U.S. company’s shares lower on bets that the deal could face greater political opposition. down nearly 13%.
Philippe Fong | AFP | Getty Images
Japanese Nippon Steel CEO reiterated Tuesday that company won’t give up on acquisitions United States Steel CorporationA day earlier, the company sued Joe Biden’s administration over blocking the proposed merger.
U.S. Steel and Nippon Steel announced on Monday that they have two lawsuits filed The Biden administration decided to block Nippon Steel’s $14.9 billion acquisition of the U.S. steelmaker.
In a statement accompanying the lawsuit, the companies said they continue to believe the deal is “the best way to secure U.S. Steel’s future” and stressed their right to pursue a merger.
Nippon Steel Chairman and CEO Eiji Hashimoto reinforced that stance at a news conference on Tuesday.
“There is no reason or necessity to abandon (the acquisition). We simply cannot accept it,” Hashimoto said. press conference.
According to Reuters, Hashimoto stressed that he would never give up on expanding his business in the United States and was not considering any alternative plans beyond the company’s current acquisition of U.S. Steel.
Last Friday, Biden is officially banned Japan’s Nippon Steel has acquired U.S. Steel, fulfilling a promise to bring an industrial brand with more than a century of history under American ownership.
Nippon Steel’s stock price one year ago
Both companies have filed lawsuits in federal court seeking to overturn Biden’s decision.
In a statement released on Monday, both sides claimed that Biden influenced decisions by the Committee on Foreign Investment in the United States (CFIUS), which evaluates foreign investments for potential national security threats, and violated companies’ rights to a fair review.
“The Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”) failed to conduct a good-faith, national security-focused regulatory review process due to President Biden’s exercise of undue influence to advance his political agenda,” the companies said.
The White House did not immediately respond to CNBC’s request for comment.
Hashimoto added that Nippon Steel would explain to the new U.S. administration how the acquisition would strengthen U.S. Steel and broader U.S. industry.
incoming president Donald Trump besides vowed to stop Nippon Steel has repeatedly planned to acquire U.S. Steel.
The real reason why the Nippon Steel/U.S. Steel merger failed was primarily political.
“Why would they sell U.S. Steel now when tariffs will make it a more profitable and valuable company?” Trump posts on his social media platform Truth Social on Monday.
“The real reason why the Nippon Steel/U.S. Steel merger failed was primarily political,” CreditSights analysts said in a note after the lawsuit, stressing that the timing of the deal was “unfavorable” for Nippon Steel, given how it was progressing “. Presidential election year.
The research firm also insisted that while CFIUS expressed some reservations, it did not make a formal recommendation on whether the acquisition should proceed.
Last week, Nippon Steel offered to provide the U.S. government with Has veto power over capacity cuts at U.S. Steel.
Nippon Steel’s shares fell 1.74% during Japanese trading hours.
