President-elect Donald Trump‘s Former U.S. Secretary of State Mike Pompeo has thrown his support behind Nippon Steel Corp.‘s (OTC:NPSCY) (OTC:NISTF) proposed $14.9 billion acquisition of United States Steel Corp. (NYSE:X), arguing the deal would strengthen America’s position against Chinese market dominance.
What Happened: In an opinion piece published in The Wall Street Journal on Friday, Pompeo, who now serves as a strategic adviser to Nippon Steel, emphasized that the transaction would enhance U.S. national and economic security while protecting American jobs.
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The deal faces significant opposition from both 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 refers its decision later this month.
Pompeo countered these concerns, stating that blocking the deal would “undermine America’s national security by diminishing our ability to maintain robust and competitive domestic steel production.” He highlighted Nippon Steel’s commitment to invest $2.7 billion in union-represented local steel facilities.
U.S. Steel spokesperson Amanda Malkowski has previously defended the transaction, stating that “this transaction should be approved on its merits.” Nippon Steel expressed confidence in the American legal system, indicating it would pursue legal action if necessary.
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Why It Matters: The Japanese steelmaker’s proposed acquisition comes amid growing concerns about China’s steel overproduction and its impact on global markets.
Biden has until Dec. 22 or 23 to receive CFIUS’s referral and must announce his decision within 7 days. U.S. Steel shares have experienced volatility as investors react to developments surrounding the proposed acquisition.
In November after his election victory, Trump made a declaration in a post on Truth Social, stating, “I will not be inviting former Ambassador Nikki Haley, or former Secretary of State Mike Pompeo, to join the Trump Administration, which is currently in formation.”
