The European Union (EU) has approved Japan's Nippon Steel's acquisition of US Steel for $14.9 billion despite facing opposition in the United States.
EU Approves Japan's Nippon Steel-US Steel Merger Despite US Opposition
In a statement released Monday, the European Commission said it allowed the deal because the firms would not raise competition concerns "given the companies' limited market positions resulting from the proposed transaction."
According to Reuters, the European Commission's approval was meant to be a formality. However, the deal is encountering opposition in the US. Politicians are concerned about national security, and the United Steelworkers union representing US Steel is worried about job losses.
President Joe Biden has advocated for domestic ownership of US Steel, while former leader and presidential candidate Donald Trump said he will veto the sale if elected.
To allay fears, Japan's Nippon Steel has offered to relocate its American headquarters to Pittsburgh, where US Steel is located. It has also pledged to uphold any existing agreements between US Steel and the United Steelworkers.
If the acquisition is successful, Nippon Steel, the fourth-largest steelmaker in the world, will be able to increase its worldwide crude steel capacity to 100 million metric tons.
US Steel Shareholders Unanimously Approved the Deal in April
US Steel shareholders overwhelmingly approved the merger last month despite growing resistance. However, US Steel recently said that as part of an antitrust review, the Department of Justice had requested additional information on the proposed merger.
US Steel now expects the deal to close in the second half of the year and no longer on the previous deadline of the second to third quarter.
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