The US Department of Justice has initiated an in-depth antitrust investigation into Nippon Steel's $14.1 billion takeover bid for United States Steel Corp, Politico reported Wednesday.
The probe was confirmed by sources with direct knowledge of the matter, although it was not disclosed when exactly the DOJ officially opened the probe.
This move intensifies the examination of the deal, which has been under fire from various quarters, including lawmakers and labor unions, who have expressed concerns over national security and the control of a key American industrial asset by a foreign entity.
President Joe Biden Stresses Domestic Ownership of US Steel
US President Joe Biden, in a notable statement preceding Japanese Prime Minister Fumio Kishida's visit to the country, emphasized the importance of US Steel remaining domestically owned and operated.
Japanese Prime Minister Kishida did not criticize the Department of Justice's scrutiny of the transaction during his official visit.
"Japan believes that appropriate procedures based on law are being implemented by the US government," Kishida stated at a joint press conference with President Biden.
The United Steelworkers union, meanwhile, opposes the takeover, citing potential risks to American jobs.
President Biden, maintaining his stance on protecting American workers, reiterated his commitment during the joint press conference.
Antitrust Probe Shifts Focus to Manufacturing Plant
The initiation of the antitrust investigation comes amidst ongoing reviews by regulatory bodies.
The companies have recently submitted the deal for review by EU antitrust regulators, with a provisional decision deadline set for May 17.
However, the focus of the DOJ's scrutiny is not on foreign ownership concerns but rather on potential antitrust implications, especially concerning a manufacturing plant in Calvert, Alabama.
The review process is expected to be thorough and may extend over several months.
While antitrust concerns are a significant aspect of this investigation, another critical hurdle remains with the Committee on Foreign Investment in the US, which evaluates foreign investments in American assets.
Nippon Steel Corporation, headquartered in Chiyoda-ku, Tokyo, is Japan's leading steelmaker. It is the largest producer of crude steel in Japan and ranks as the third largest globally.
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