Reuters: US says Nippon Steel’s deal poses national security risk | NHK WORLD-JAPAN News

A media report says the Biden Administration has told Nippon Steel that its bid to acquire US Steel would pose a national security risk.

The two companies agreed on the deal in December. But many people in the US have expressed strong opposition.

Reuters news agency is reporting that a US interagency body sent a letter to the two steelmakers, telling them a takeover could disrupt supply chains and pose a national security risk.

Reuters says the letter was sent on August 31 by the Committee on Foreign Investment in the United States. The body is in charge of reviewing the effects of foreign investment on the country’s national security.

Its 17-page document reportedly says Nippon Steel’s acquisition could “lead to a reduction in domestic production capacity.”

The committee claims the transaction could harm steel supplies needed for transportation, infrastructure, construction and agriculture.

Western media outlets reported on Wednesday that President Joe Biden is preparing to block Nippon Steel’s acquisition attempt.

The company responded in a statement saying it clearly told the US government that the deal poses no national-security concerns.

The statement says, “Nippon Steel strongly believes that the US government should appropriately handle procedures on this matter in accordance with the law.”