Bussiness
Biden blocks Nippon Steel’s $15bn bid for US Steel over national security fears – as it happened
Key events
Closing post
Time to wrap up…
US president Joe Biden has used his final days in office to block Japanese firm Nippon Steel from taking over US Steel, amid national security concerns.
The general sentiment: keep key US resources like steel under the control of US companies.
The move has prompted pushback from the Japanese industry minister, who says that the decision is ‘regrettable’ and ‘difficult to comprehend’.
However, this is one of the few policies that his successor, president-elect Donald Trump, has also backed.
Elsewhere, Trump has been making waves after he used his Truth Social media platform to hit out at UK wind farms and windfall taxes on North Sea oil producers.
But we started off the day on UK high streets, after the British Retail Consortium released data showing that footfall had dropped 2.2% in December, which is a crucial month for the industry.
We also had the Bank of England release data showing weaker-than-expected mortgage and consumer lending in the UK – though mortgage brokers say December demand has since picked up.
That’s all from us today. Have a great weekend and we’ll be back with normal programming on Monday -KM
Japan’s industry minister says blocking Nippon bid is ‘difficult to comprehend’ – Reuters
Reuters is running comments from Japan’s industry minister Yoji Muto who has said that Biden’s decision to block Nippon Steel’s acquisition is ‘difficult to comprehend and regrettable’.
Muto adds that he is hearing strong expressions of concern from Japanese industry over future investment between Japan and the US, and that the government has ‘no choice but to take this matter gravely’.
The Japanese minister said he will request explanation and action from the Biden administration to ‘dispel such concerns’.
Callum Jones
Full story: US president Joe Biden on Friday followed through on his pledge to block Nippon Steel’s $14.9bn bid for US Steel, citing concerns the deal could hurt national security.
“US Steel will remain a proud American company – one that’s American-owned, American-operated, by American union steelworkers – the best in the world,” Biden said in a statement.
The move, long expected, cuts off a critical lifeline of capital for the beleaguered American icon, which has said it would have to idle key mills without the nearly $3bn in promised investment from the Japanese firm.
It also represents the final chapter in a high-profile national security review, led by the Committee on Foreign Investment in the United States (CFIUS), which vets investment for national security risks and had until 23 December to approve, extend the timeline or recommend that Biden block the deal.
The proposed tie-up has faced high-level opposition within the United States since it was announced a year ago, with both Biden and his incoming successor, Donald Trump, taking aim at it as they sought to woo union voters in the swing state of Pennsylvania, where US Steel is headquartered. Trump and Biden both asserted the company should remain American-owned.
The merger appeared to be on the fast track to be blocked after the companies received a 31 August letter from the CFIUS, seen by Reuters, arguing the deal could hurt the supply of steel needed for critical transportation, construction and agriculture projects.
Read more here:
US Steel shares tumble 7.8%
Wall Street has opened for trading and, as expected, there has been a sell-off in US Steel shares following Biden’s decision to block Nippon Steel’s takeover offer.
US Steel shares fell as much as 7.8% at the open. They seem to be paring losses slightly to trade around 5.5% lower, but it may take some time for shares to settle.
The White House has released a full statement from US president Joe Biden on the blocked US Steel deal.
He stresses that US companies handling critical US resources must continue “leading the fight on behalf of America’s national interests.”
As a committee of national security and trade experts across the executive branch determined, this acquisition would place one of America’s largest steel producers under foreign control and create risk for our national security and our critical supply chains.
So, that is why I am taking action to block this deal.
Biden adds that it is his “solemn responsibility as president” to ensure that the US has a strong domestically owned and operated steel industry that can continue to power its “national sources of strength at home and abroad” :
And it is a fulfillment of that responsibility to block foreign ownership of this vital American company. U.S. Steel will remain a proud American company – one that’s American-owned, American-operated, by American union steelworkers – the best in the world.
Today’s action reflects my unflinching commitment to utilize all authorities available to me as president to defend US national security, including by ensuring that American companies continue to play a central role in sectors that are critical for our national security.
As I have made clear since day one: I will never hesitate to act to protect the security of this nation and its infrastructure as well as the resilience of its supply chains.
Jillian Ambrose
Green campaigners have taken aim at the US president-elect after Donald Trump took to his social media platform Truth Social earlier today to hit out at the UK for taxing oil companies and allowing windmills in the North Sea.
Tessa Khan, executive director at Uplift, a group which campaigns for swift but fair transition away from oil and gas production in the UK, said Trump was “clearly looking after the interests of US oil and gas firms who have made billions during the recent energy crisis” :
His team is shot through with oil and gas interests that want the rest of the world, the UK included, to slow its transition to clean energy and remain hooked on oil and gas for years to come just so they can keep profiting.
For the UK to be free from fossil fuel politics, it must take advantage of the immense opportunities at its fingertips in wind power, which offers a long-term solution to energy security and job creation, and continue to tax the energy giants who have driven millions into fuel poverty accordingly.
Khan said that the UK, and Scotland in particular could use “some of the best wind resources in the world” to help secure Britain’s energy supplies as the North Sea oil and gas basin declines:
Ill informed attacks on the UK’s efforts to become a clean energy superpower will not change reality – the nation has burnt most of its gas, and what’s left of our oil is mainly exported.
Some further background on the now-blocked deal:
The deal was meant to see Nippon Steel, Japan’s largest steelmaker, takeover US Steel, the Pittsburgh steel producer established in 1901 that played a vital role in America’s industrialisation,.
The deal, which was announced last year, faced criticism from the United Steelworkers union as well as several lawmakers, who viewed the deal as a threat to national security, job security and workers’ pensions.
Biden and the vice-president, Kamala Harris had long expressed opposition to the deal.
It was put under review by the Committee on Foreign Investments in the United States, a government panel that reviews foreign acquisitions of American companies.
In September, the Biden administration extended that review, which delayed a decision until after the presidential election.
While Biden pulled the trigger on blocking the deal, it appeared as if his successor was ready to do the same.
President-elect Donald Trump said in early December that he also opposed the proposed takeover:
I am totally against the once great and powerful U.S. Steel being bought by a foreign company, in this case Nippon Steel of Japan.
Through a series of Tax Incentives and Tariffs, we will make U.S. Steel Strong and Great Again, and it will happen FAST! As President, I will block this deal from happening. Buyer Beware!!!
US Steel shares are currently down 7.8% at $30.03 in pre-market trading
President Biden blocks Nippon Steel’s $15bn bid for US Steel on security grounds
BREAKING: The US president has blocked a $15bn bid by Nippon Steel for American rival US Steel, over fears it could harm national security.
Biden issued the presidential order on Friday, forcing Nippon and US Steel to “to fully and permanently abandon the proposed transaction” within 30 days.
There is credible evidence that leads me to believe that Nippon Steel…might take action that threatens to impair the national security of the United States.
Biden added that he he did not believe existing laws including the International Emergency Economic Powers Act “provide adequate and appropriate authority for me to protect the national security in this matter.”
The Purchasers and US Steel shall take all steps necessary to fully and permanently abandon the Proposed Transaction no later than 30 days after the date of this order
It marks one of the last major order by the outgoing, who has 17 days before he hands the White House over to president elect Donald Trump.
European bourses fall into red, but US stocks futures look bright
European bourses, which struggled to find direction at the start of trading today, have tumbled into the red:
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FTSE 100 is down 0.05%
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Germany’s Xetra Dax is down 0.35%
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France’s CAC 40 is down 0.75%
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Italy’s FTSE MIB is is down 0.48%
However, US markets are pointing to a more optimistic end to the week:
But Susannah Streeter, head of money and markets at Hargreaves Lansdown says this could fade throughout the session:
Wall Street looks set for a higher open, but it may end up being a replica of yesterday’s performance, with early optimism fading.
With the US economy showing so much resilience, the hopes for successive interest rate cuts this year have fizzled out, with only two now expected, at the most.
Given the super-stellar year for US stocks in 2024, it’s not surprising a bit more caution has crept in amid uncertainty about monetary policy, especially with unpredictable changes from the White House expected.
Commenting on the Bank of England data, the Nathan Emerson, the CEO of Propertymark – a membership organisation for estate agents – says lower interest rates will be key for bolstering the mortgage market in the months ahead.
Emerson says:
The impact of higher interest rates without doubt has had a profound impact across the housing market.
Consumers need to feel a degree of confidence within their financial position to approach the buying and selling process, and it is essential that aspects such as inflation are managed robustly to keep long-term stability across the economy, which is needed for a healthy and secure housing market.
Propertymark is keen to see interest rates lowered further when conditions permit to help spur growth in 2025.
HSBC has announced a raft mortgage rate reductions, in a sign that it is trying to lure buyers racing to complete purchases before stamp duty hikes comes into force in April.
Nicolas Mendes of broker John Charcol says it will be welcome news for the housing market:
Following the festive period, this change comes at a crucial time, as many potential home movers start reengaging with plans for the year ahead and first-time buyers look to act swiftly ahead of the stamp duty changes.
The cuts span across products, and includes existing residential customers who are switching to a new contract, those looking to borrow more, as well as first-time buyers, home movers, and those seeking green mortgages for energy-efficient homes.
Mendes adds:
These reductions, covering fixed terms from 2 to 10 years and LTVs of up to 95%, reflect HSBC’s efforts to remain competitive and capturing a diverse range of customers.
Buy-to-let investors and international clients are also included, widening the appeal.
Budget airlines Ryanair and Wizz Air have reported a jump in passenger numbers in December, despite flight disruptions over the holiday period.
Ryanair carried 13.6 million passengers in December, up 8% on the same period last year. It operated 77,000 flights over the month, with a load factor – a metric used to indicate how full flights are – of 92%.
It means the Irish airline carried 197.2 million passengers for the whole of 2024, up 8% on 2023.
Wizz Air, meanwhile, carried 5.1 million passengers, up 1.9% year-on-year. Its rolling total for the year came to 62.7 million passengers, up 3.9% on the previous year.
That is despite disruption to flights over the holiday period, at several UK airports, including Stansted and Gatwick, which suffered fog-related delays and cancellations.
While November’s mortgage lending figures fell short of analyst forecasts, mortgage brokers say homebuyer demand has been strong as of late.
Charles Yuille, managing director at Willow Brook Mortgages said:
November was an average month, possibly due to the Autumn Budget taking the steam out of the market and hitting sentiment. That appears to be reflected in this data.
Mortgage rates also edged up slightly, which may have dampened demand. But demand was still there due to the approaching stamp duty deadline.
December, though, was one of the broker’s busiest months of the year:
Enquiry levels were strong among home movers and first-time buyers alike, keen to save money on stamp duty.
We expect a strong start to the year and for other lenders to follow the likes of Halifax and Leeds in cutting rates.
Lenders like Santander will be resetting their targets and Nationwide is approaching its year end so lenders will want to fill their boots with borrowers.
The next few months should be a favourable time for anyone looking to buy and we know that demand for property, whatever the economic conditions, tends to remain strong.
Mark Sweney
Laura Ashley has been acquired by New York-based Marquee Brands, the owner of 17 businesses including Ben Sherman and Martha Stewart.
The clothing and home furnishings brand, best known for its floaty floral frocks, has been sold by Gordon Brothers.
Gordon Brothers has owned Laura Ashley since 2020, when the US restructuring specialist bought the business out of administration after it became the first major retail casualty of the Covid pandemic.
The company, which has no stores of its own, made a return to the high street the following year through a deal with Next.
Laura Ashley also has deals in place with DFS and John Lewis in the UK, and is available in 150 shops globally via a network of overseas licensees.
The deal with Marquee Brands will result in Laura Ashley’s UK-based team, which is run by Poppy Marshall-Lawton, being retained and the US company opening its first European headquarters in London.
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Biden’s move to block Nippon Steel takeover creates uncertainty for US Steel workers
Biden’s decision to block Nippon Steel takeover creates uncertainty for U.S. Steel workers
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