Nippon Steel slams 'inappropriate' politics in US deal

TOKYO

Nippon Steel on Dec. 11 slammed the "inappropriate" influence of politics on its planned takeover of U.S. Steel after a media report said President Joe Biden would block it.

The deal worth $14.9 billion including debts is being reviewed by a body in Washington that assesses foreign takeovers of U.S. firms.

Bloomberg News, citing people close to the matter, said Biden planned to kill the sale on national security grounds when the review is finished later this month.

"It is inappropriate that politics continue to outweigh true national security interests—especially with the indispensable alliance between the U.S. and Japan as the important foundation," a Nippon Steel statement said.

"We have engaged in good faith with all parties to underscore how the transaction will bolster American economic and national security by countering the threats posed by China," it added.

"Nippon Steel still has confidence in the justice and fairness of America and its legal system and, if necessary, will work with U.S. Steel to consider and take all available measures to reach a fair conclusion."

The takeover was agreed to by the companies around a year ago.

After the deal was first announced, Biden said it was "vital" that U.S. Steel be "domestically owned and operated."

Days after the November U.S. election, Nippon Steel said it expected to close its takeover of the company before the end of the year, while Biden was still in office.

President-elect Donald Trump has also vowed to block the deal, pledging to bolster U.S. Steel through tax incentives and tariffs instead.

In reaction to the Bloomberg report, the White House said Biden was awaiting the outcome of the ongoing review by the Committee on Foreign Investment in the United States (CFIUS), helmed by Treasury Secretary Janet Yellen.

"The president's position since the beginning is that it is vital for U.S. steel to be domestically owned and operated," spokeswoman Robyn Patterson said.

"We have not received any CFIUS recommendation. The CFIUS process was and remains ongoing."

U.S. Steel shares closed down 9.7 percent on Dec. 10 on Wall Street following the report. Nippon was down 0.4 percent in Tokyo on Wednesday.

Japan's top government spokesman, Yoshimasa Hayashi, declined to comment directly on the deal but said Japan and the United States would continue "broad" discussions on economic matters.

"It is essential for both sides to strengthen Japan-U.S. economic ties, including the expansion of mutual investment," Hayashi said.