Nippon Steel and US Steel Sue Biden After $15 Billion Merger Blocked

Nippon Steel and US Steel have filed two lawsuits in the US alleging wrongful interference after the proposed $15bn combination between the steelmakers was blocked by President Joe Biden just days earlier. In a statement on Monday, the companies said that the first suit asked for Biden’s decision to be set aside because of unlawful political interference in the process.

The second suit was filed against rival steel producer Cleveland-Cliffs, its chief executive Lourenco Goncalves and United Steelworkers president David McCall, alleging illegal and coordinated actions aimed at preventing the transaction. “Today’s legal actions demonstrate Nippon Steel’s and US Steel’s continued commitment to completing the transaction,” the companies said in the statement. The legal claims mark the latest twist in a takeover saga that has put the US-Japan relationship under considerable strain, heralded a new hostility in the US investment climate and thrown into question the independence of America’s national security investment screening mechanism. In an order issued on Friday blocking the deal, Biden said there was “credible evidence” that, through the acquisition, Nippon might take steps that would hurt US security. Through the lawsuits, Nippon and US Steel aim to establish that Biden “ignored the rule of law” to gain favour with the unions and support his political agenda and that the Committee on Foreign Investment in the US (Cfius), which screens overseas buyers of US companies, failed to conduct a review in good faith. The Cfius process was intended to reach a “pre-determined result” after Biden outlined his opposition to the transaction in March, before any security review had taken place, the companies added. They also aimed to show that US rival Cleveland-Cliffs sought to prevent any other buyer from acquiring US Steel as “part of a broader illegal campaign to monopolise the domestic steel markets”

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