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Joe Biden blocks Nippon Steel’s $15bn takeover of US Steel

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Joe Biden blocks Nippon Steel’s bn takeover of US Steel

US President Joe Biden has blocked a $15bn deal by Japan’s Nippon Steel to buy US Steel, delivering a setback to Washington’s relations with its closest Asia-Pacific ally and prompting the companies to threaten legal action.

Biden, who has long been opposed to the purchase, issued an order on Friday compelling Nippon and US Steel “to fully and permanently abandon the proposed transaction” within 30 days.

In response, the two companies labelled the move “a clear violation of due process” and the law. In an indication of possible legal action, they added: “Following President Biden’s decision, we are left with no choice but to take all appropriate action to protect our legal rights.”

A clause in the original agreement with US Steel obliges Nippon to pay a $565mn break-fee payment in the event the deal is blocked.

Biden’s extraordinary intervention, which comes with just 17 days remaining of his term, caps a presidency in which he has sought to boost American jobs and has moved away from the free-trade agenda of previous administrations.

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It is also likely to raise concerns about US receptiveness to future foreign investment, with president-elect Donald Trump, who won November’s election on a protectionist platform, also opposing the deal.

The companies said it was “shocking and deeply troubling that the US government would . . . treat an ally like Japan in this way”.

They added: “Unfortunately, it sends a chilling message to any company based in a US-allied country contemplating significant investment in the US.”

In the order, Biden said there was “credible evidence” that through the acquisition, Nippon “might take action that threatens to impair the national security of the United States”.

The Committee on Foreign Investment, which vets foreign acquisitions, failed to reach a consensus by a December 23 deadline on whether the transaction posed a national security threat.

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The companies said the president had not presented any “credible evidence of a national security issue”, adding that “instead of abiding by the law, the process was manipulated to advance President Biden’s political agenda”.

They added the Cfius process “was deeply corrupted by politics, and the outcome was pre-determined”.

Biden’s intervention marks the failure of Nippon Steel’s ambitious expansion plan that morphed into a sensitive political issue in a US election year.

The decision by the outgoing president, who is known for his support for organised labour, follows fierce opposition to the deal from the United Steelworkers union. The group’s campaign proved fatal to the purchase, despite intense lobbying in recent weeks from executives at US Steel and Nippon.

The White House said Biden’s decision was not meant as a snub to Tokyo.

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“This isn’t about Japan. It’s about US steelmaking,” National Security Council spokesperson John Kirby said on Friday. It is about “keeping one of the largest steel producers in the United States an American-owned company. It is not about the extraordinary, close relationship, any alliance, that we have with Japan.”

US Steel shares were down more than 6 per cent after the decision.

Opponents of the takeover welcomed Biden’s decision.

Sherrod Brown, the outgoing Democratic senator from Ohio, wrote on X: “This deal . . . represented a clear threat to America’s national and economic security and our ability to enforce our trade laws. It’s why we fought it every step of the way. The president is right to block it.”

Biden’s move to quash the deal will leave the fate of US Steel in limbo. The company had warned it might close mills and reduce its workforce, possibly moving its headquarters away from Pittsburgh, Pennsylvania, if the agreement was blocked.

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Nippon’s proposed takeover had attracted significant support in parts of the US that would have benefited from the promised investment and technology from the Japanese company.

William Chou, deputy director of the Japan chair at the Hudson Institute think-tank, said the decision would devastate the steelmaking communities in western Pennsylvania and Indiana.

“President Biden talks about protecting the American steel industry, but only in the abstract,” he added. “At no point did he engage with actual steelworkers, or address the technology needed to empower them to safeguard the steel industry.”

Japanese officials, speaking on condition of anonymity, have previously said that, while they understood the risk of political intervention that Nippon faced when launching a bid ahead of a US presidential election, it was baffling that a Japanese company should be labelled a security risk.

Heino Klinck, a former US deputy assistant secretary for defence for east Asia, said it was “ironic and nonsensical” that national security concerns were being cited as rationale for blocking the deal, because Japan hosted the world’s largest presence of the US’s forward-deployed military forces.

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“This decision will cast a shadow on the alliance,” he said. “It is indeed unfortunate that the Biden administration has handed the Chinese Communist party yet another talking point on America not being a reliable partner.”

Additional reporting by Steff Chávez

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Map: 2.3-Magnitude Earthquake Reported North of New York City

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Map: 2.3-Magnitude Earthquake Reported North of New York City

Note: Map shows the area with a shake intensity of 3 or greater, which U.S.G.S. defines as “weak,” though the earthquake may be felt outside the areas shown.  All times on the map are Eastern. The New York Times

A minor, 2.3-magnitude earthquake struck about 12 miles north of New York City on Tuesday, according to the United States Geological Survey.

The temblor happened at 10:17 a.m. Eastern in Sleepy Hollow, N.Y., data from the agency shows.

The Westchester County emergency services department said in a statement that it had not received any reports of damage.

As seismologists review available data, they may revise the earthquake’s reported magnitude. Additional information collected about the earthquake may also prompt U.S.G.S. scientists to update the shake-severity map.

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Source: United States Geological Survey | Notes: Shaking categories are based on the Modified Mercalli Intensity scale. When aftershock data is available, the corresponding maps and charts include earthquakes within 100 miles and seven days of the initial quake. All times above are Eastern. Shake data is as of Tuesday, March 10 at 10:30 a.m. Eastern. Aftershocks data is as of Tuesday, March 10 at 2:18 p.m. Eastern.

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Ed Martin, outspoken Justice Department lawyer, is formally accused of ethical violations | CNN Politics

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Ed Martin, outspoken Justice Department lawyer, is formally accused of ethical violations | CNN Politics

Ed Martin, an outspoken Trump administration official, is facing attorney discipline proceedings in Washington, DC, for a letter he sent to Georgetown Law about its diversity programs, the district’s professional conduct investigator announced on Tuesday.

Martin is formally accused of violating his ethical codes as an attorney for telling Georgetown Law’s dean last year that his Justice Department office wouldn’t hire students because of the school’s diversity, inclusion and equity initiatives programs, according to the filing from Hamilton Fox, the disciplinary counsel for DC who acts as a quasi-prosecutor on attorney discipline matters.

Unlike unsolicited complaints, Fox’s formal disciplinary complaint kicks off professional conduct proceedings for Martin in which he will need to respond and could be sanctioned or ultimately lose his law license.

Fox’s announcement on Tuesday marks the first major bar discipline proceeding against a high-profile administration official or attorney supporting President Donald Trump during Trump’s second term. Several Trump lawyers faced disciplinary proceedings after the efforts to overturn Joe Biden’s victory in the 2020 presidential election, including Rudy Giuliani, who lost his law license.

“Acting in his official capacity and speaking on behalf of the government, he used coercion to punish or suppress a disfavored viewpoint, the teaching and promotion of ‘DEI,’” Fox wrote in the complaint. “He demanded that Georgetown Law relinquish its free speech and religious rights in order to continue to obtain a benefit, employment opportunities for its students.”

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Martin was removed from the top prosecutor job in DC after senators made clear he would not be confirmed to the role, but has remained at the Justice Department in several roles, including as pardon attorney.

“Mr. Martin knew or should have known that, as a government official, his conduct violated the First and Fifth Amendments to the Constitution of the United States,” Fox wrote.

Martin is being represented by a Justice Department attorney, a source told CNN.

A spokesperson for DOJ attacked Fox’s complaint. “The DC bar’s attempt to target and punish those serving President Trump while refusing to investigate or act against actual ethical violations that were committed by Biden and Obama administration attorneys is a clear indication of this partisan organization’s agenda,” DOJ said.

Martin had sent the letter to Georgetown Law while serving temporarily as US attorney for DC, a prominent Justice Department position, and told the school his federal prosecutors’ office wouldn’t hire Georgetown’s law school students. It came at a time when the Trump administration was beginning to crack down on universities for their DEI efforts.

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In his letter, Martin claimed a whistleblower told him that the school was teaching and promoting DEI.

Martin also violated attorney ethics rules by contacting judges of the DC court directly, Fox alleged, rather than going through official channels, once he was informed he was under investigation for his professional conduct. The DC Court of Appeals ultimately signs off on attorney discipline findings.

Early last year, Fox’s office had formally asked Martin to respond to a complaint it received by a retired judge regarding the Georgetown letter.

Martin instead wrote to the judges on the DC court complaining about Fox.

“In that letter, he stated that he would not be responding to Disciplinary Counsel’s inquiry, complained about Disciplinary Counsel’s ‘uneven behavior,’ and requested a ‘face-to-face meeting with all of you to discuss this matter and find a way forward,’” Fox wrote.

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“He copied the White House Counsel ‘for informational purposes because of the importance of getting this issue addressed,’” Fox said.

The top judge in the DC courts told Martin the court wouldn’t meet with him about the disciplinary matter and that he would need to follow procedure.

With Fox’s complaint, there will now be several steps ahead of bar discipline authorities looking at Martin’s action, and Fox didn’t specify how Martin should be reprimanded or punished if the discipline boards and the court ultimately determine he violated his ethical codes.

Spokespeople for the Justice Department didn’t immediately respond to requests for comment on Tuesday morning.

In recent days, Attorney General Pam Bondi announced her office would have a more powerful role in reviewing attorney discipline complaints against Justice Department attorneys, potentially setting up an approach that could keep the department at odds with the bar on behalf of DOJ attorneys facing their own individual disciplinary proceedings.

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CNN’s Paula Reid contributed to this report.

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Europe and Asia battle for LNG as Iran war chokes supply

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Europe and Asia battle for LNG as Iran war chokes supply

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Asian and European buyers are battling to source liquefied natural gas after the war in the Middle East choked off shipments through the Strait of Hormuz, blocking a fifth of global supplies.

In an indication of the intensifying contest for LNG since the US and Israel launched strikes on Iran, a handful of gas carriers have abruptly changed course while sailing to Europe and swung towards Asia instead, according to ship monitoring data analysed by the FT.

Countries across Asia are highly dependent on oil and gas sent through the Strait of Hormuz, a critical waterway where shipping has slowed to a near standstill.

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Most of the LNG produced in Qatar and the United Arab Emirates is ordinarily shipped through the strait to Asia, and Asian LNG prices surged almost immediately after war broke out, creating an incentive to divert US gas to the region.

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Taiwan, South Korea and Japan are among the countries that need to source LNG to make up for supplies they will not receive from the Gulf, said Massimo Di Odoardo, head of gas and LNG analysis at consultancy Wood Mackenzie.

Taiwan relied on Qatar for more than 30 per cent of its gas consumption in 2025, according to Citigroup, while for South Korea and Japan the figures were 15 per cent and 5 per cent respectively. Asia typically uses more gas than Europe in the hotter summer months because of more air-conditioning use, creating urgency for Asian utilities to secure cargoes.

The vast majority of LNG is sold under long-term contracts rather than on the spot market, but some buyers are able to change the final destination of their purchases and some sellers are willing to break contracts if prices rise high enough.

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By Thursday, surging European gas prices and rocketing shipping rates had swung the balance back against diversion of US LNG to Asia, according to data company Spark Commodities.

The decision on where to send gas carriers can depend on the relative levels of the European gas price, Asia’s JKM benchmark for LNG and shipping rates.

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For European buyers, the battle with Asia for LNG supplies is eerily familiar to the situation four years ago after Russia slashed pipeline natural gas flows to the continent following Moscow’s full-scale invasion of Ukraine. Competition for spare cargoes then pushed prices to record levels.

On Monday, European gas prices reached as high as €69.50 per megawatt hour, more than double their level before the Iran conflict began. Even so, prices are still far from the €342 per megawatt hour reached in 2022.

JKM gas prices also more than doubled since the start of the war to $24.80 per 1mn British thermal units by Monday, equivalent to €73.10/MWh.

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European buyers have learnt from their experience in 2022. “Europe has more weapons at its disposal in this extreme price scenario to try and fight,” said Alex Kerr, a partner at law firm Baker Botts.

Buyers had started putting clauses in contracts to say that suppliers would face much higher penalties if they diverted cargoes for commercial gain, Kerr said.

There is also much more LNG on the market now that is not committed to set destinations, largely because of new projects starting in the US.

While producers such as Qatar impose strict rules on where its LNG can be sent, almost all US exports are allowed to sail wherever buyers want. Several analysts said there had also been an increase in the willingness of some producers to break contracts for financial advantage.

This makes diversions more likely, while the reluctance of some European buyers to sign long-term supply contracts before the outbreak of war this month could prove costly.

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Expectations of a global supply glut convinced some European buyers that it would be cheaper to wait until later in the year to sign supply deals.

Wood Mackenzie’s Di Odoardo said the buyers had also held off on LNG purchases because new EU legislation on methane emissions made it unclear whether they could incur penalties in the future.

The risk of prices rising as Europe and Asia fight for available cargoes is increasing every day the Strait of Hormuz stays almost closed.

Gas is more difficult to store and to carry in tankers than oil, making its markets more vulnerable to shortages and price shocks.

“The longer the Strait remains shut, the greater the risk that the shipping disruption turns into a genuine gas shortage, as tankers cannot load and facilities have limited storage,” said consultancy Oxford Economics in a research note.

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Additional reporting by Harry Dempsey in Tokyo. Data visualisation by Jana Tauschinski

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