Trump Orders CFIUS to Reassess U.S. Steel Acquisition by Nippon Steel, Stocks Surge

On Monday, former U.S. President Donald Trump directed the Committee on Foreign Investment in the United States (CFIUS) to re-examine the proposed acquisition of U.S. Steel by Japan's Nippon Steel. This directive comes after the deal was previously halted by the administration of then-President Joe Biden. The decision to reopen the review process has sparked significant market interest, with U.S. Steel's stock price experiencing a notable increase.

According to a statement released by the White House, Trump instructed CFIUS to reassess the acquisition proposal. The goal is to determine whether further action is warranted in light of the potential national security implications. Trump has given the committee 45 days to submit recommendations on whether the measures proposed by U.S. Steel and Nippon Steel are sufficient to mitigate any national security risks.

Biden's administration had blocked the $14.9 billion deal in January, citing concerns that the acquisition of one of the largest steel producers in the U.S. by a foreign entity could pose a threat to critical supply chains. Trump, who had initially opposed the deal, seemed to soften his stance during a meeting with Japanese Prime Minister Fumio Kishida in February. At that time, Trump indicated that Japan would make significant investments in U.S. Steel rather than acquiring the company outright.

The market's reaction to Trump's order reflects a sense of optimism among investors. The re-evaluation process is seen as a potential pathway for the deal to move forward, despite the previous administration's objections. This optimism is rooted in the belief that the new review could lead to a different outcome, possibly allowing the acquisition to proceed. The market's response highlights the critical role that regulatory approvals play in shaping the future of corporate transactions, especially those involving strategic assets and national security considerations.