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Bond Market News
US and Nippon Steel File Lawsuits After Blocking of Merger Deal
January 7, 2025
US Steel and Nippon Steel filed a lawsuit against US President Joe Biden, claiming he unlawfully blocked their $14.9bn merger through a biased national security review. They allege that Biden influenced the CFIUS to prejudge the deal, violating their right to a fair review. The companies argue that the deal’s blockage was politically motivated to gain favor with the United Steelworkers (USW) union. The companies also filed a second lawsuit targeting Cleveland-Cliffs and USW President David McCall, accusing them of colluding to prevent the merger and allowing Cleveland-Cliffs to dominate the US steel market. Biden had initially opposed the deal in March 2024 before CFIUS conducted its review, furthering the companies’ claims that the review process was manipulated. The companies are seeking to have the decision overturned, allowing a fresh review free from political influence. However, the prospects of the lawsuit are unclear, as courts usually defer to CFIUS on national security matters.
US Steel bonds traded stable with its 6.875% 2029s at 100.5, yielding 6.73%.
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