The chairman of Nippon Steel vows not to give up the plan to acquire US Steel

In 2025, the international steel industry witnessed a highly anticipated acquisition turmoil. At a press conference held in Tokyo, the chairman and CEO of Nippon Steel Corporation (referred to as Nippon Steel), Eiji Hashimoto, firmly stated that they would "never give up" on the plan to acquire United States Steel Corporation (referred to as U.S. Steel). This declaration not only reflects Nippon Steel's unwavering determination for this acquisition but also reveals the complex economic, strategic, and international relations factors behind it.

The matter originated on December 18, 2023, when Nippon Steel and US Steel announced the conclusion of a final agreement. According to the agreement, Nippon Steel will acquire US Steel at a price of $55 per share through an all-cash transaction, including its business in Slovakia, with a total value of approximately $14.9 billion. If this transaction is successful, it will increase Nippon Steel's annual crude steel production capacity to 86 million tons, accelerating the realization of its strategic goal of achieving a global crude steel production capacity of 100 million tons annually.

However, this acquisition plan has encountered numerous obstacles since its announcement. On January 3, 2025, US President Joe Biden issued a statement through the White House, officially blocking Nippon Steel's acquisition of US Steel. In his statement, Biden said that steel is crucial for the operation of the US infrastructure, automotive industry, and defense industry. If US Steel were acquired by foreign capital, it would pose a risk to the US national security and important supply chains. This decision undoubtedly threw cold water on Nippon Steel's acquisition plan.

In the face of Biden's opposition, Eiji Hashimoto expressed strong dissatisfaction and disappointment at a press conference. He accused Biden's decision to block the acquisition on national security grounds as "improper", and claimed that the Committee on Foreign Investment in the United States (CFIUS) had been subject to "illegal political interference" by Biden and failed to properly carry out the review process. Hashimoto emphasized that Nippon Steel and US Steel were in agreement that there was no reason to abandon the acquisition, and that this acquisition would actually help enhance the national security of the United States. He also disclosed that Nippon Steel and US Steel had officially filed a lawsuit against Biden and CFIUS, requesting the court to revoke the acquisition ban and re-examine the case.

Nippon Steel's insistence on acquiring US Steel is underpinned by profound economic and strategic considerations. Firstly, from an economic perspective, US Steel's annual production capacity of approximately 22.4 million tons is highly attractive to Nippon Steel. If the acquisition is successful, Nippon Steel is expected to rise to a leading position in the global steel production ranking, thereby securing a more advantageous position in the global distribution of steel resources and market competition. Additionally, US Steel's advanced technologies in specialized steel and iron ore resources will provide Nippon Steel with opportunities for technological upgrading and resource assurance.

Secondly, from the perspective of strategic layout, the acquisition of US Steel holds significant strategic importance for Nippon Steel. In recent years, the global supply chain has shown a trend towards localization and regionalization. The United States has explicitly proposed policies of "decoupling" from China or so-called "de-risking". In the future, the reindustrialization of the United States will drive up the demand for steel. By acquiring US Steel, Nippon Steel can serve the US market more conveniently, alleviate the unfavorable situation of exports, and expand its overseas market. At the same time, US Steel's long-term production and technical management experience with large electric furnaces and mini-mills, as well as its leading position in digital transformation, will also provide strong support for Nippon Steel's medium and long-term business plans.

However, Nippon Steel's acquisition plan has not been smooth sailing. Besides the opposition from Biden and the resistance from the CFIUS review, Nippon Steel also faces strong opposition from interest groups such as the United Steelworkers (USW). They believe that Nippon Steel's acquisition will harm the interests of the US steel manufacturing industry and American steelworkers. These opposing voices undoubtedly increase the difficulty and uncertainty of Nippon Steel's acquisition plan.

Despite this, Nippon Steel has not given up its efforts. At a press conference, Eiji Hashimoto stated that Nippon Steel will take all measures to safeguard its legitimate legal rights and continue to push forward with the acquisition plan. He also disclosed that Nippon Steel has hired heavyweights such as former US Secretary of State Mike Pompeo to advance the acquisition process and plans to challenge Biden's order blocking the acquisition through legal means and other methods.

In addition, Nippon Steel is also actively seeking support and understanding from the US political circle. It is reported that when Japanese Prime Minister Ishiba wrote to Biden, he specifically mentioned the hope of reaching the acquisition deal and emphasized Japan's status as the largest investor in the US and the many benefits of the acquisition for both countries. This move reflects the Japanese government's firm determination and strategic considerations for this acquisition plan.

However, the future of the acquisition remains highly uncertain. On the one hand, the Biden administration's opposition is firm, and the review process of CFIUS is complex and lengthy; on the other hand, although Nippon Steel has shown great determination and perseverance, whether it can ultimately succeed in acquiring US Steel still depends on the combined effect of multiple factors.

In conclusion, the statement by Nippon Steel's chairman, Eiji Hashimoto, that he will "never give up" on the acquisition of US Steel not only reveals Nippon Steel's firm determination for this acquisition but also reflects the complex economic, strategic and international relations factors behind it. This acquisition turmoil not only concerns the interests of the United States and Japan, but will also stir up waves in the global steel industry landscape. In the future, as the situation develops and changes, we may witness an even more intense and complex international competition in the steel industry.