Investing.com -- Nippon Steel's $14.9 billion acquisition proposal for U.S. Steel has not received approval from the Committee on Foreign Investment in the United States (CFIUS), according to a letter viewed by sources. This comes despite Nippon Steel's continuous efforts to alleviate national security concerns through meetings, calls with U.S. officials, and three revised proposals.
The letter, dispatched on Saturday, paves the way for U.S. President Joe Biden, who has consistently opposed the deal, to potentially block it. The CFIUS, which assesses transactions for national security risks, has until Dec. 23 to greenlight the deal, extend the review period, or suggest Biden to reject it.
The letter indicates that if the agencies comprising the panel continue to be at odds, they will refer the issue to Biden for action.
Nippon Steel's persistent attempts to secure approval for the contentious merger since early September have included four face-to-face meetings with the CFIUS, three phone discussions, one of which was on Friday with the Treasury and Commerce department secretaries, and three proposed mitigation agreements. All these details are captured in the Saturday-dated letter sent to Nippon Steel by the CFIUS, which has not been reported before.
The letter suggests that the deal is possibly in jeopardy, despite the companies' extensive efforts to gain approval.
The CFIUS concludes in the letter that it has not reached a consensus on whether the mitigation measures proposed by the parties would be effective or if they would address the risk to U.S. national security arising from the transaction. The letter further states that the President has the authority to suspend or prohibit a transaction that threatens to impair national security for as long as he deems appropriate.
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