President Donald Trump has ordered a new national security review of Nippon Steel's proposed acquisition of U.S. Steel, reversing a previous block on the deal and signaling a potential shift in the administration's stance on foreign investment in critical industries, CNBC reported.
On Monday, Trump ordered the renewed review of the proposed $14.9 billion acquisition of U.S. Steel by Japan's Nippon Steel following an earlier decision by President Joe Biden to block the deal over national security concerns.
The president directed the Committee on Foreign Investment in the United States to revisit the transaction "to assist in determining whether further action in this matter may be appropriate." The committee was given 45 days to deliver a recommendation on whether measures proposed by U.S. Steel and Nippon are "sufficient to mitigate any national security risks."
The decision sent U.S. Steel's stock soaring, with shares jumping more than 16% to close at $44.49.
Biden blocked the deal in January, citing its potential threat to critical U.S. supply chains if one of the country's largest steelmakers fell under foreign ownership.
Trump has publicly opposed the deal in the past. However, his tone appeared to shift in February during a meeting with Japanese Prime Minister Shigeru Ishiba, when the president suggested Nippon could invest heavily in U.S. Steel rather than pursue full ownership.
Once a symbol of American industrial dominance, U.S. Steel has faced decades of decline. By mid-2023, the Pittsburgh-based company, no longer the largest or second-largest U.S. steelmaker, was up for sale.
In December, it reached an agreement to be purchased by Nippon Steel, a leading global steelmaker, for $14 billion. Nippon also pledged billions more in upgrades to modernize the company's aging facilities, according to CNN.
The proposed sale sparked swift and vocal opposition from the United Steelworkers union, which represents about 11,000 of U.S. Steel's 14,000 domestic employees. The union expressed concern over Nippon's long-term commitment to the company's unionized mills.
In his Monday order, Trump did not explicitly endorse or reject the transaction but signaled that further scrutiny was needed to assess whether national security concerns could be resolved through additional conditions or changes to the deal.
Jim Thomas ✉
Jim Thomas is a writer based in Indiana. He holds a bachelor's degree in Political Science, a law degree from U.I.C. Law School, and has practiced law for more than 20 years.
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