Nippon Steel offers U.S. government veto power in bid for U.S. Steel approval, source tells Reuters

Japan’s Nippon Steel has proposed giving the U.S. government veto power over any potential cuts to U.S. Steel‘s production capacity, as part of its efforts to secure President Joe Biden’s approval for acquiring the American steelmaker, a source familiar with the matter said on Tuesday.

Last week, the Committee on Foreign Investment in the United States referred the decision to approve or block the deal to Biden.

Biden, who will leave office on Jan. 20, must decide on the deal by Jan. 7. If he takes no action, it would result in the merger’s automatic approval.

“We received the CFIUS evaluation and the President will review it,” a White House spokesperson said on Tuesday.

The Washington Post reported earlier that in its proposal, Nippon Steel pledged a 10-year commitment not to cut production capacity at U.S. Steel’s domestic mills, unless approved by a Treasury-led review panel.

Shares of U.S. Steel popped on the Washington Post report, closing up 9.5% Tuesday.

U.S. Steel and Nippon Steel did not immediately respond to Reuters’ requests for comment.