From Tokyo, Japan and New Plymouth, New Zealand – this is Down to Business English. With your hosts Skip Montreux and Samantha Vega.
Hello Samantha.
Hi Skip. How are you doing?
I am doing well, thank you. Yourself?
I’m fine. But I have a very interesting question for you.
Oh? What is that?
Are we Americans yet?
Americans? What are you talking about? You and I are Canadian through and through — True North Strong and Free!
Well, if the newly re-elected President Donald Trump has his way, Canada might just become the 51st US state I’m hearing.
Ah, that! Yes, he has made plenty of headlines with bold statements recently — buying Greenland, retaking the Panama Canal, and yes, even suggesting Canada join the United States.
So, you don’t take these ideas too seriously?
Well at first glance, these proposals do seem unlikely to happen. But I have to admit, his comments about Canada becoming a US state do raise important questions about economic integration and the potential for closer cooperation between Canada and the US.
And what about Greenland or the Panama Canal? What do you think about those?
Those ideas are equally as bold, but somewhat unnecessary I think.
What do you mean?
I just think there are less contentious ways to achieve similar strategic goals.
I suppose that’s just his negotiating style — starting with big demands to set the tone.
Exactly. It’s a negotiating tactic. But whether it works or not, one thing is for sure — the next four years are going to be very interesting now that Donald Trump is back in the White House.
And with the US being the biggest economy in the world, it is pretty hard to avoid talking about its influence on global business.
Which brings us to the subject of today’s business report.
What are we reporting on today?
Today on Down to Business English I want to discuss a business news story that has been making headlines both here in Japan and in the United States . Samantha: And what would that be? On January 3rd of this year, with only days left in his term, outgoing US President Joe Biden blocked the sale of US Steel to Nippon Steel.
I actually did hear about that. He said the sale of such an iconic US company to foreign owners was a threat to national security.
National security was a part of it. US Steel is a very old American company, going all the way back to 1901. In fact, they played an important role in building many iconic American structures like the Empire State Building. And today, even though they are still the largest steel company in the US, they only rank 24th largest in the world.
And Nippon Steel is larger, isn’t it?
Much larger. Nippon Steel is currently the 4th largest steel company worldwide.
Wow, significantly bigger. With the US and Japan being such close allies, I’m guessing Nippon Steel isn’t very happy about this decision to block the sale.
Not in the least.
Well, I’d certainly like to learn more about this.
Great! Then let’s do it. Let’s get D2B … Down to Business with Steel Standoff — The Blocked Nippon-US Steel Acquisition. Let's start with a timeline of the key events in this story. Samantha, do you know when this deal was first announced?
When Nippon Steel announced they were trying to purchase US Steel? I have no idea.
It was first made public on December 18, 2023 when Nippon Steel announced a $14.9 billion all-cash deal to acquire US Steel.
And how did US Steel shareholders react to that offer?
Overall, they were very positive about it. In April 2024, over 98% of shareholders voted in favor of the deal.
Oh, that's an overwhelming majority.
And by May 30, both companies had received all the necessary regulatory approvals outside of the U.S. However, things started to get complicated in September.
Complicated? What was the complication?
Reports began to emerge that the Biden administration was preparing to block the acquisition. This led to Nippon Steel delaying their deadline to buy US Steel to March 2025.
But they didn't make it to March, did they?
No, they didn't. On January 3, 2025, just days before leaving office, President Biden blocked the deal via an executive order.
An executive order. That’s when a US President issues a directive that must be followed by federal agencies.
Yes. And it doesn’t require the US Congress to authorize it. Although Congress could at a later date, overturn it.
And that's when the lawsuits started flying? After Biden issued his Executive order.
They sure did. On January 6, only three days later, both companies — Nippon Steel and US Steel — filed lawsuits against the US government over the Executive order.
They are not giving up.
No, they’re not.
So, why is Nippon Steel so keen on this acquisition in the first place?
They have several motivations for the acquisition. Primarily, the deal would create the world's second-largest steel producer, giving Nippon Steel a significant competitive edge in the global market.
But they are already the 4th largest steel maker you said. Any other reasons?
It would also give Nippon Steel direct access to the US market which would help them avoid any tariffs that President Trump might put in place on steel imports.
Hmm. A good strategy. What were the arguments in favor of the acquisition on the US side?
Proponents of the deal argued that it would revitalize US Steel with significant investments and technological upgrades. They also claimed it would preserve and potentially create jobs for American workers.
Two positive outcomes.
Advocates also argued the acquisition would enhance U.S. competitiveness in the global steel market, particularly against Chinese steel makers. Six of the top 10 steel makers in the world are Chinese and they account for half of global steel production.
Why did the Biden administration decide to block the deal, then?
The primary reason cited was national security concerns. The administration argued that placing such a key industry under foreign control could pose risks to US national security.
Were there any other concerns besides that?
Yes, there were. The USW, or United Steelworkers Union — they were worried about potential job losses and plant closures. And others feared it could impact the domestic steel supply chain and reduce U.S. control over a very strategic and very important industry.
It seems like there are valid arguments on both sides.
Mm. No doubt about that.
So, where does this leave things now?
Now that there are active lawsuits underway, the government has extended the deadline for Nippon Steel to abandon their acquisition proposal until the end of June.
To let the court challenges play out.
And there has been some movement by two other smaller American steel companies, Cleveland-Cliffs and Nucor, who are making a joint offer to buy US Steel.
That must be good news for the unions.
But US Steel can’t really negotiate with them in good faith until the situation with Nippon Steel is resolved. And Nippon Steel CEO Eiji Hashimoto has stated they are not giving up on the deal and will continue to fight for it.
What are the broader implications of this situation?
This case raises significant questions about foreign investment in the United States, particularly in industries deemed strategically important.
Which is ironic because Donald Trump is always touting his ability to attract foreign investment in the US. Where does he stand on this?
Believe it or not, he and Biden are on the same page about this. Trump posted back in December on social media that he was “... totally against the once great and powerful U.S. Steel being bought by a foreign company …” Samantha: Something tells me that this story is far from over. Indeed, it's likely to be subject to ongoing legal battles and potential diplomatic discussions. It's certainly a situation we'll be keeping a close eye on in the coming months.
And while we wait for this to unfold, I think it's time for us to get D2V... Down to Vocabulary. The first item on our D2V list today is the noun standoff. A standoff is a situation where two sides are in opposition to each other, and are unable to come to an agreement.
Standoffs happen when neither side is willing to back down, or change their position. Just imagine two people standing face to face, neither one willing to move out of the other's way.
Mm. That is a good image. The title of today’s D2B report is “Steel Standoff: The Blocked Nippon-US Steel Acquisition.” Our report focuses on the US government’s decision to block the acquisition.
In other words we have Nippon Steel and US Steel on one side and the US government on the other and neither side is willing to back down or change their position.
Can you give us a business-related example using standoff, Skip?
An example would be a labor strike. For instance, “The standoff between the auto workers’ union and the car manufacturer dragged on for weeks, with neither side willing to change their position on wages.”
Good example. Labor standoffs are something that we often see in the news. What’s next on our D2V list?
The next item on our D2V list is the adjective contentious. When you describe something as contentious, you are saying it causes disagreement or conflict because people have different opinions about it.
Something that is too contentious could lead to a standoff.
That is very true. In the introduction to today’s episode When I was talking about Donald Trump’s recent remarks about Canada becoming a US State, the US taking over the Panama Canal, and purchasing Greenland — I said there were less contentious ways to achieve his goals.
Skip was saying Donald Trump’s bold proposals were causing heated debate and disagreement among different groups of people.
Exactly.
Contentious situations often arise in business negotiations or decisions.
Can you give us an example of that?
Mm. For example, “The board meeting became contentious when several of the members couldn’t agree on the company’s plans for expansion. The CEO wants to open a new factory but the CFO says there’s no way the company can pay for it.”
Hm. I can clearly imagine that situation. Contentious issues often bring out strong emotions or differing opinions between people, making them difficult to resolve.
So true. Our next, and final word today is the phrase an overwhelming majority. An overwhelming majority refers to a very large percentage of people agreeing on something.
Can’t you just say ‘a majority’? What’s different about ‘an overwhelming majority’?
A majority doesn’t communicate size. It can mean as little as 51 to 49 or as much as 80 to 20.
Hm. So, an overwhelming majority clearly communicates there is a large number of people agreeing with each other.
Precisely. In today’s story, Skip reported that 98% of US Steel shareholders voted in favor of letting Nippon Steel acquire the company. I replied by commenting that it was an overwhelming majority.
98 to 2. That is a lot of shareholders in agreement with each other.
Almost everyone is in agreement, leaving very little opposition. Can you give us another example using ‘overwhelming majority’, Skip?
I can. My company recently conducted an employee survey about our work from home policy. An overwhelming majority of staff supported continuing to work remotely three days a week.
That doesn’t surprise me. Will your company continue to let the staff do that?
I don’t know, it’s a bit of a contentious issue. Our president is very much against it. There will be an official announcement in the next few weeks.
Whatever the decision, I hope it doesn’t lead to a standoff between management and staff.
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Thanks Skip, for that report on Nippon Steel's attempts to purchase US Steel. I’m sure we haven’t heard the last on this story.
I’m sure we haven’t. Steel is such an important part of the global economy, that whatever the final outcome is, it will certainly have an impact in the sector.
No doubt. D2B Members and Apple Podcast Subscribers, your bonus Down to Vocabulary for today’s episode will be coming your way shortly, so keep an eye out for that.
The words and phrases we will focus on in that bonus episode will be: complicated, to start flying, a proponent, to revitalize, and a broad implication. All very high frequency business vocabulary.
D2B Members, be sure you have copied and pasted your Member-only URL from your Members Account page on the D2B website into your podcast app of your choice. That way you won’t miss that bonus episode. And Apple Podcast Subscribers, you don’t need to do anything. The D2V episode will automatically show up in your Apple Podcast app when it is released.
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That’s d2benglish.com/membership.
Thanks for listening everyone. See you next time.
Take care.
Down to Business English... Business News, to improve your Business English.