President Joe Biden believes \u201cserious scrutiny\u201d is warranted for the planned acquisition of US Steel by Japan\u2019s Nippon Steel, the White House said Thursday after days of silence on a transaction that has drawn alarm from the steelworkers union. Lael Brainard, the director of the National Economic Council, indicated the deal would be reviewed by the secretive Committee on Foreign Investment in the United States, which she participates in and includes economic and national security agency representatives to investigate national security risks from foreign investments in American firms.<\/p>\n
She said in a statement that Biden \u201cbelieves the purchase of this iconic American-owned company by a foreign entity \u2013 even one from a close ally \u2013 appears to deserve serious scrutiny in terms of its potential impact on national security and supply chain reliability.\u201d \u201cThis looks like the type of transaction that the interagency Committee on Foreign Investment Congress empowered and the Biden administration strengthened is set up to carefully investigate,\u201d she said. \u201cThis administration will be ready to look carefully at the findings of any such investigation and to act if appropriate.\u201d<\/p>\n
Under the terms of the approximately USD 14.1 billion all-cash deal announced Monday, U.S. Steel will keep its name and its headquarters in Pittsburgh, where it was founded in 1901 by J.P. Morgan and Andrew Carnegie. It will become a subsidiary of Nippon. The combined company will be among the top three steel-producing companies in the world, according to 2022 figures from the World Steel Association. Chaired by Treasury Secretary Janet Yellen, the CFIUS screens business deals between U.S. firms and foreign investors and can block sales or force parties to change the terms of an agreement for the purpose of protecting national security.<\/p>\n
The committee\u2019s powers were significantly expanded in 2018 through an act of Congress called the Foreign Investment Risk Review Modernization Act, known as FIRRMA. In September, President Biden issued an executive order that expands the factors that the committee should consider when reviewing deals \u2013 such as how the deal impacts the U.S. supply chain or risks to Americans\u2019 sensitive personal data. It has on some occasions forced foreign companies to divest their ownership in American firms.<\/p>\n
In 2020 Beijing Kunlun, a Chinese mobile video game company, agreed to sell gay dating app Grindr after it received an order from CFIUS. United Steelworkers International, which endorsed Biden\u2019s 2020 presidential campaign, swiftly opposed the new transaction. The union \u201cremained open throughout this process to working with U.S. Steel to keep this iconic American company domestically owned and operated, but instead it chose to push aside the concerns of its dedicated workforce and sell to a foreign-owned company,\u201d said David McCall, president of United Steelworkers, in a statement after the transaction was announced, adding that the union wasn\u2019t consulted in advance of the announcement.<\/p>\n
\u201cWe also will strongly urge government regulators to carefully scrutinize this acquisition and determine if the proposed transaction serves the national security interests of the United States and benefits workers,\u201d he added. Political allies of Biden in Pennsylvania \u2013 a presidential battleground state that is critical to his reelection campaign \u2013 also objected to the sale this week, and released statements pressing Nippon to make commitments to keep U.S. Steel\u2019s workers, plants and headquarters in the state. Some also described it as the latest example of profit-hungry executives selling out American workers to a foreign company.<\/p>\n
Democratic U.S. Sen. Bob Casey said it appeared to be a \u201cbad deal\u201d for the state and workers, while Democratic U.S. Sen. John Fetterman \u2013 who lives across the street from U.S. Steel\u2019s Edgar Thompson plant just outside Pittsburgh \u2013 said he will attempt to prevent the sale based on national security issues. \u201cIt\u2019s absolutely outrageous that U.S. Steel has agreed to sell themselves to a foreign company,\u201d Fetterman said. Speaking on the condition of anonymity to discuss the committee, a Treasury spokesperson said: \u201cCFIUS is committed to taking all necessary actions within its authority to safeguard U.S. national security. Consistent with law and practice, CFIUS does not publicly comment on transactions that it may or may not be reviewing.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
President Joe Biden believes \u201cserious scrutiny\u201d is warranted for the planned acquisition of US Steel by Japan\u2019s Nippon Steel, the\u2026<\/p>\n","protected":false},"author":28,"featured_media":18785,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[5871,5872,5873,2989,149,1852,101,5870,5867,5448,2378,5866,5868,5869,5449,3225,3334],"class_list":["post-18782","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-politics","tag-committee-on-foreign-investment-in-the-united-states","tag-democratic-u-s-sen-bob-casey","tag-democratic-u-s-sen-john-fetterman","tag-foreign-investment","tag-japan","tag-jobs","tag-joe-biden","tag-lael-brainard-director-of-the-national-economic-council","tag-national-security","tag-nippon-steel","tag-sale","tag-scrutiny","tag-unions","tag-united-steelworkers-international","tag-us-steel","tag-us-treasury-secretary-janet-yellen","tag-workers"],"reading_time":"4 min read","_links":{"self":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts\/18782","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/users\/28"}],"replies":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/comments?post=18782"}],"version-history":[{"count":0,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/posts\/18782\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/media\/18785"}],"wp:attachment":[{"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/media?parent=18782"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/categories?post=18782"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.businessupturn.com\/usa\/wp-json\/wp\/v2\/tags?post=18782"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}