The Associated Press reported on Friday that President Joe Biden has blocked the $14.9 billion proposed acquisition of US Steel by Japan's Nippon Steel, citing national security and economic concerns.

The decision fulfills Biden's campaign pledge to prevent foreign ownership of one of America's most iconic steel companies, headquartered in Pittsburgh.

"We need major US companies representing the major share of US steelmaking capacity to keep leading the fight on behalf of America's national interests," Biden said in a statement issued Friday morning.

Union Support

The decision follows a review by the Committee on Foreign Investment in the United States (CFIUS), which could not reach a consensus on whether the deal posed a national security risk.

Biden was given 15 days to decide after receiving the committee's report, which is chaired by Treasury Secretary Janet Yellen and includes other Cabinet members.

Steelworkers' unions applauded Biden's action. David McCall, President of the United Steelworkers, described the decision as the "right move for our members and our national security."

He also accused Nippon Steel of being "a serial trade cheater," adding, "Allowing it to purchase US Steel would have offered it the opportunity to further destabilize our trade system from within and in the process, compromise our ability to meet our own national security and critical infrastructure needs."

Legal Threat

Nippon Steel and US Steel strongly criticized Biden's decision, calling it "a clear violation of due process and the law."

In a joint statement, the companies claimed the process had been "manipulated" for political purposes and suggested they would pursue legal action, stating, "We are left with no choice but to take all appropriate action to protect our legal rights."

The companies also argued that Biden had not provided credible evidence of a national security threat and warned the decision would discourage foreign investment in the US, "Unfortunately, it sends a chilling message to any company based in a US-allied country contemplating significant investment in the United States," the statement said.

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The decision comes just weeks before Biden leaves office, raising questions about how it could impact US-Japan relations. Japan is a key ally and the largest foreign holder of US debt.

President-elect Donald Trump has also voiced opposition to the deal, vowing in December to block it and promote domestic steel production through tariffs and tax incentives.

Rewind

Biden's opposition to the deal dates back to March 2023, when he expressed concerns about its potential impact on union jobs and the broader economy.

"It is important that we maintain strong American steel companies powered by American steel workers," Biden said at the time, adding that US Steel must remain "domestically owned and operated."

Nippon Steel had pledged to preserve US Steel's name, keep its Pittsburgh headquarters, and invest in unionized facilities to compete with China. The company also offered financial incentives to workers, including $5,000 bonuses for US Steel employees.

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Despite these commitments, the proposed sale faced significant opposition from unions, trade advocates, and parts of the Biden administration.

Analysts have noted that the decision reflects growing political momentum to rebuild America's manufacturing sector and strengthen domestic supply chains.