president-elect donald trumpFormer US Secretary of State mike pompeo has given his support Nippon Steel Corp.(OTC:NPSCY) (OTC:NISTF) proposed the $14.9 billion acquisition of United States Steel Corporation. (NYSE:X), arguing that the agreement would strengthen the United States’ position against the dominance of the Chinese market.
What happened: In an op-ed published in The Wall Street Journal on Friday, Pompeo, who now serves as a strategic advisor to Nippon Steel, emphasized that the transaction would improve U.S. national and economic security while protecting American jobs.
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The agreement faces significant opposition from both the President joe biden and Trump. According to Bloomberg sources, Biden is expected to block the acquisition on national security grounds when the Committee on Foreign Investment in the United States submits its decision later this month.
Pompeo responded to these concerns, stating that blocking the deal “would undermine U.S. national security by diminishing our ability to maintain robust and competitive domestic steel production.” He highlighted Nippon Steel’s commitment to investing $2.7 billion in local steel facilities represented by unions.
US Steel Spokesman Amanda Malkowski has previously defended the transaction, stating that “this transaction should be approved on its merits.” Nippon Steel expressed confidence in the US legal system and indicated it would take legal action if necessary.
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Why is it important: The Japanese steelmaker’s proposed acquisition comes amid growing concerns about China’s overproduction of steel and its impact on global markets.
Biden has until December 22 or 23 to receive the CFIUS referral and must announce his decision within 7 days. US Steel shares have experienced volatility as investors react to developments surrounding the proposed acquisition.
In November, after his election victory, Trump made a statement in a post on Truth Social: “I will not invite former ambassador nikki haleyor former Secretary of State Mike Pompeo, to join the Trump Administration, which is currently in formation.”