*

White House declines comment on reports of Biden's

decision

*

CFIUS referred decision to Biden amid concern over

U.S.-Japan

ties

*

Nippon Steel ( NISTF ) offered concessions, including U.S. HQ move

and

production veto power

(Changes attribution in headline, paragraph 1)

By David Shepardson

WASHINGTON/TOKYO, Jan 2 (Reuters) - U.S. President Joe

Biden has decided to officially block Nippon Steel's ( NISTF )

proposed $14.9-billion purchase of U.S. Steel, a person

familiar with the decision said on Friday, putting an end to a

long-running and contentious merger plan.

The Committee on Foreign Investment in the United States

(CFIUS) had previously referred the decision to approve or block

the deal to Biden, who will leave office on Jan. 20.

Biden's call to block the deal was taken despite contrary

efforts by some senior advisers concerned that it could hurt

U.S.- Japan relations, according to the Washington Post, which

first reported the news.

It cited two administration officials who were not

authorized to speak publicly about the matter.

A White House spokesperson declined to comment on the

reports. A source told Reuters a decision by Biden was expected

as soon as Friday. A spokesperson for Nippon Steel ( NISTF ) declined to

comment on the report.

U.S. Steel directed Reuters to a statement earlier on

Thursday saying it hoped "Biden will do the right thing and

adhere to the law by approving a transaction that so clearly

enhances U.S. national and economic security."

Nippon paid a hefty premium to clinch the purchase of the

No.2 U.S. steel producer in a December 2023 auction, but the

deal faced opposition from the powerful United Steelworkers

union (USW), as well as politicians.

Biden has said he wants U.S. Steel to be domestically owned

and run, while President-elect Donald Trump has vowed to block

the deal after he takes office in January.

Despite the opposition, U.S. Steel shareholders voted

overwhelmingly to approve the acquisition last April.

The two companies had also worked to assuage concerns over

the merger. Nippon offered to move its U.S. headquarters to

Pittsburgh, where the U.S. steelmaker is based and promised to

honor all agreements in place between U.S. Steel and USW.

This week, a source familiar with the matter said Nippon

Steel ( NISTF ) had also 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 Biden's approval.

Japanese Prime Minister Shigeru Ishiba urged Biden to

approve the merger to avoid marring recent efforts to strengthen

ties between the two key allies, Reuters reported in November.

Japan's stock market was closed for a public holiday on

Friday. U.S. Steel shares closed down 4.1% on Thursday.

METI, Japan's industry ministry, and a spokesperson for

Ishiba could not be reached for a comment, because of the

holiday.