The proposed $14.9 billion acquisition of US Steel by Japan's Nippon Steel has sparked intense debate over potential national security risks.
The US Treasury, which oversees the Committee on Foreign Investment in the United States (CFIUS), revealed that the panel of nine federal agencies has not yet reached a consensus on how to handle these concerns, according to recent reports.
CFIUS Deadline Looms Over Nippon Steel's US Steel Deal Amid Security Concerns
CFIUS, tasked with reviewing foreign investments in US firms to safeguard national security, has until December 22 to make a recommendation to President Joe Biden, Reuters said.
Options include approving, blocking, or extending the review timeline for the high-profile deal.
As the deadline looms, the lack of agreement among the agencies makes it increasingly likely that the President will block the acquisition, sources say.
Key concerns center on the potential impact of foreign ownership on the supply of steel critical for US infrastructure projects, including transportation, construction, and agriculture. In September, CFIUS warned both companies that the deal could create risks to national security.
While some agencies, including the Pentagon and State Department, reportedly believe the acquisition does not pose a security threat, others, such as the US Trade Representative's Office and the Department of Commerce, remain opposed or have raised concerns.
The Biden administration is reportedly divided on the matter, with President Biden signaling his intent to block the deal once CFIUS delivers its recommendation.
The administration's cautious stance reflects broader concerns about foreign influence in key American industries, especially in sectors tied to national security.
Read Also: Pennsylvania Chocolate Factory Explosion Caused by Gas Leak, Lack of Evacuation Procedures
Mitigation Plan Proposed, but Divisions Persist in Nippon Steel–US Steel Deal Review
According to SeekingAlpha, despite the opposition, CFIUS has drafted a mitigation agreement outlining steps Nippon Steel could take to address security concerns.
However, divisions within the panel have prevented a unanimous recommendation, escalating the matter to a presidential decision.
This deal has drawn bipartisan scrutiny, with outgoing President Donald Trump also expressing opposition to foreign control over US Steel, a company historically regarded as a cornerstone of American industry.
Deputy cabinet secretaries from CFIUS agencies met last week but failed to resolve their differences. Another meeting is planned in hopes of reaching a resolution before the December deadline.
Both Nippon Steel and US Steel have declined to comment, while the US Treasury and Commerce Department have remained similarly silent on the issue.
The decision on whether to approve the acquisition now rests with the Biden administration, setting the stage for a pivotal moment in balancing economic interests and national security priorities.
