According to a US media source on Tuesday, Nippon Steel has submitted a fresh proposal on US Steel to the White House in an effort to obtain President Joe Biden’s approval to purchase the American business.
According to The Washington Post, the proposal entails granting the US government a veto over cutting US Steel’s production capacity.
According to reports, Nippon Steel promised for ten years that it would not reduce production capacity at US Steel’s mills in states like Pennsylvania, Indiana, and Alabama unless a panel headed by the Treasury Department gave its consent.
This was in response to the Committee on Foreign Investment in the United States (CFIUS) panel’s inability to agree on whether Nippon Steel’s purchase of US Steel poses a national security risk to Washington.
The impasse by CFIUS shifts the decision on the $14.9 billion transaction to the White House.
Biden must make a decision before the beginning of January.
However, the president has been vocally opposing the pact for months, joining a chorus of influential US figures who have done so.
Among them are JD Vance, the incoming vice president, and Donald Trump, the president-elect.
When Pennsylvania emerged as a crucial swing state and United Steelworkers union officials vocally opposed the contract, it became embroiled in the US presidential election of 2024.
After the election, Nippon officials had hoped for greater success, but there haven’t been many indications that things have changed.
While the president has publicly opposed the deal, The Washington Post reported Tuesday that many of his advisers favor the transaction.
Biden could set conditions for the approval of the takeover, however, the news report said.
For example, this could involve Nippon Steel adhering to requirements like the preservation of US jobs, The Washington Post added.
It noted that sorting out the details could nudge the matter past Inauguration Day on January 20.
Nippon Steel did not immediately respond to a request for comment.
The latest proposal adds to Nippon Steel’s pledge to rule out layoffs or closures of unionized facilities for the period of the current union contract expiring in September 2026, the report added.
US media have previously reported that the killing of the deal could prompt litigation from the steel companies.
There are also questions about diplomatic fallout from derailing a transaction championed by Japan, a close US ally.
