Nippon Steel Corp and US Steel Corp yesterday filed suit over US President Joe Biden’s decision to block the Japanese giant’s proposed acquisition of its American rival, accusing his administration of “illegal interference” in the huge transaction.
The companies said in a statement that they initiated the legal action in the US court of appeals in Washington challenging the review process for the acquisition, claiming Biden, who is leaving office on Jan. 20, had improperly used his influence and blocked the deal “for purely political reasons.”
The companies filed their lawsuits “to remedy the ongoing illegal interference with Nippon Steel’s acquisition of US Steel,” they said, adding that the litigation intends to show that “President Biden ignored the rule of law to gain favor with (workers’ unions) and support his political agenda.”
Photo: Kazuhiro Nogi, AFP
Biden had criticized the US$14.9 billion deal for months, while holding off on a move that could hurt ties with Tokyo.
But the outgoing president — who made the rebuilding of the US manufacturing base a major goal of his administration — announced on Friday that he was blocking the acquisition, saying it threatened national security.
The announcement drew sharp criticism from both companies and Tokyo.
The companies said the body reviewing the deal, the Committee on Foreign Investment in the United States (CFIUS), “failed to conduct a good faith, national security-focused regulatory review process.”
The steelmakers are asking the courts to order a new review of the proposed merger.
Japanese Prime Minister Shigeru Ishiba yesterday urged Washington to dispel concerns that Biden’s block of the deal could impact future investments.
The transaction was a prominent element of last year’s presidential campaign, given US Steel’s ties to Pennsylvania, a politically critical battleground state and cradle of the American steel industry.
In an interview with Nikkei business daily, Nippon Steel vice chairman Takahiro Mori said his company “will not back down after being treated unreasonably. We will fight tooth and nail.”
The CFIUS review process “lacked integrity,” he said, adding that “the decision was left to the president (Biden) without any substantive consultation” with the companies.
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