A national security review of Nippon Steel’s $15 billion bid for U.S. Steel is ongoing and President Joe Biden will see what it yields before making a decision on whether to block it, the White House said on Tuesday, cautioning he still opposes the tie-up.

The statement comes after shares of U.S. Steel tumbled more than 10% on Tuesday afternoon following a Bloomberg report suggesting the deal would be killed in short order.

CFIUS, a powerful committee charged with reviewing foreign investments in U.S. firms for national security risks, has until December 22 to make a decision on whether to approve, block or extend the timeline for the deal’s review, Reuters has reported.

“The President’s position since the beginning is that it is vital for U.S. Steel to be domestically owned and operated,” Saloni Sharma, a White House spokesperson said in a statement. “As we have said before, the President will continue to see what the CFIUS process yields. We have not received any CFIUS recommendation. The CFIUS process was and remains ongoing.”

Bloomberg’s initial headline read that Biden was “set to” block the deal, suggesting a final decision had been made, but the outlet later updated it to say he “plans to” kill it, echoing prior comments and leaving the door open to a last-minute change.

CFIUS declined to comment.

Japan’s Nippon Steel said it was inappropriate that politics continued to outweigh true national security interests.

“Nippon Steel still has confidence in the justice and fairness of America and its legal system, and — if necessary — will work with U.S. Steel to consider and take all available measures to reach a fair conclusion,” it added in a statement.

U.S. Steel said the transaction should be approved on its merits.

“The benefits are overwhelmingly clear,” it said in a statement. “Our communities, customers, investors, and employees strongly support this transaction, and we will continue to advocate for them and adherence to the rule of law.”

The two companies are poised to pursue litigation over the process if Biden decides to block the merger.

The acquisition has faced opposition within the U.S. since it was announced last year with both Biden and his incoming successor Donald Trump both publicly indicating their intention to block it.

CFIUS told the two companies in September the deal would create national security risks because it could hurt the supply of steel needed for critical transportation, construction and agriculture projects.

Despite opposition, including from the United Steelworkers union, Japan’s Nippon has pressed on in pursuit of a deal, promising to not transfer any U.S. Steel production capacity or jobs outside the U.S. if the merger succeeds.

Nippon has also said it would not interfere in any of U.S. Steel’s decisions on trade matters, including decisions to pursue trade measures under U.S. law against unfair trade practices.

In a bid to win over support from workers, Nippon Steel said on Tuesday it planned to give employees $5,000 each if the deal with U.S. Steel closed. It also pledged $3,160 closing bonuses to employees in Europe, which would result in a nearly $100 million total payment to employees.
…