Biden OFFICIALLY Blocks Nippon’s $14 Billion Steel Takeover… And The Company Lawyer’s Up

President Joe Biden just pulled a move straight out of the 2016 NBA Finals playbook. Remember when LeBron James chased down Andre Iguodala, and the announcer shouted, "BLOCKED BY JAMES"? Well, Biden just delivered his own iconic block… this time, on Nippon Steel’s $14.1 billion takeover attempt of United States Steel Corp. Talk about a defensive play that’ll go down in the history books.

As we’ve been covering for the last couple months… Nippon Steel, Japan’s steel giant, was ready to drop $55 per share to acquire Pittsburgh-based U.S. Steel. That’s a premium, considering U.S. Steel shares were chilling at $32.60 before the official decision. But Biden, with a whistle from the United Steelworkers union and some serious concerns about national security, blocked the deal as one of his last actions in the oval office (along with pardoning a bunch of murderers).

And for good reason too. The Committee on Foreign Investment in the United States (CFIUS) couldn’t reach a consensus on whether the deal would compromise America’s steel output or let China tighten its grip on the global market. With the decision landing squarely on his desk, Biden didn’t hesitate to slam the brakes on the deal. U.S. Steel’s stock fell 8% at it’s low this morning, and is currently down 4%. Of course, both Nippon Steel and U.S. Steel are lawyering up, claiming the U.S. government threw the rulebook out the window (because if there’s one thing America needs more of, it’s corporate lawsuits).

For U.S. Steel, this block is less of a win and more of a “now what?” situation. The company, once the pride of America’s industrial revolution, now limps along with fewer than 22,000 employees and profits that have seen better days… last year’s $895 million was a disaster compared to 2022. Cleveland-Cliffs, their Ohio-based rival, might step back in as a buyer, but that’s a big “maybe.” Politically, this decision checks a few boxes. It keeps the United Steelworkers union happy (and swing-state Pennsylvania in play for the next election) but risks ticking off Japan, one of America’s closest allies and major investors. Nippon Steel’s VP even made multiple trips to Washington, trying to convince everyone from lawmakers to steelworkers that this deal was good for jobs and the economy.

On the national security front, critics argued that foreign ownership could leave the U.S. vulnerable. This block is a big statement: some industries are too important to hand over to foreign entities, even close allies like Japan. Of course, this move also makes Biden’s economic playbook look like it was written by an intern. One page says, “We love foreign investment! Come on in!” The next flips to, “Except if you’re eyeing anything remotely important. Then it’s a hard no.” It’s the diplomatic equivalent of inviting someone to dinner, then slapping their hand away when they reach for the good silverware.

As for U.S. Steel, it’s not 1901 anymore. The company that once built America’s skyscrapers and battleships is now stuck trying to figure out its next move. Without a buyer, a bailout, or a miracle, bankruptcy could be near. Biden’s block might have bought it some time, but whether that time leads to a turnaround or just delays the inevitable remains to be seen.

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