The president’s decision is a major use of executive power on a heavily-politicized election year issue. His announcement comes with just over two weeks left in his term. President-elect Donald Trump had vowed to crush the deal when he returns to office for his second term.
The Japanese steelmaker had also reportedly offered to give the US government veto power over any future cuts to US Steel’s production capacity, according to Reuters.
Nippon’s offer, first announced in December 2023, immediately faced heat from politicians and union leaders.
The collapse of the deal would cost Nippon a $565 million penalty, a likely detriment to future US investments.
US Steel shares plunged 8% premarket on Friday. US Steel did not immediately respond to a request for comment, and Nippon declined to comment.
Democratic and Republican lawmakers slammed the deal and treated it as a symbol of the erasure of US-owned companies.
Nippon hoped to raise its global output capacity to 85 million metric tons from 65 million through the merger.
President Joe Biden on Friday moved to block the multi-billion-dollar sale of US Steel to Japan’s Nippon Steel, citing national security concerns.
Some of Biden’s senior advisers have expressed concerns that blocking the deal could hurt relations with Japan, a close ally and major investor in US businesses, according to The Washington Post.
