By Associated Press’s FATIMA HUSSEIN
Washington (AP) The Biden administration’s decision to thwart a proposed almost $15 billion agreement for Nippon Steel to acquire Pittsburgh-based U.S. Steel is being challenged in a court lawsuit filed by Nippon Steel and U.S. Steel.
The lawsuit, which was submitted to the U.S. Court of Appeals for the District of Columbia on Monday, claims that the decision was political and that the companies’ due process was broken.
According to a prepared statement released by the companies on Monday, Nippon Steel and U.S. Steel have been working in good faith with all parties since the beginning of the process to emphasize how the Transaction will improve, not jeopardize, U.S. national security. This includes reviving communities that depend on American steel, strengthening the American steel supply chain, and fortifying America’s domestic steel industry against the threat posed by China. The only partner who is able and willing to make the required investments is Nippon Steel.
Nippon Steel had committed to investing $2.7 billion in the Mon Valley in Pennsylvania and Gary, Indiana, where U.S. Steel operates old blast furnaces. Additionally, it pledged to obtain U.S. government approval before reducing production capacity in the United States during the next ten years.
A robust domestically owned and run steel industry is a critical national security objective, which is why Biden decided to halt the Nippon purchase on Friday when federal regulators couldn’t agree on whether to allow it. … “Our country is weaker and less secure without domestic steel production and domestic steel workers,” he said in a statement.
This is the first time a U.S. president has prevented a merger between a U.S. and Japanese company, despite administration officials claiming the action has nothing to do with Japan’s relationship with the United States.
In a few weeks, Biden will leave the White House.
After the Committee on Foreign Investment in the United States, or CFIUS, failed to agree on the deal’s potential national security dangers last month and issued Biden a long-awaited report on the merger, the president decided to ban the agreement. He had fifteen days to make up his mind.
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