(Reuters) - President Donald Trump on Monday directed a powerful U.S. national security panel to take a fresh look at Nippon Steel's bid for U.S. Steel to help determine if "further action" is appropriate, raising hopes for an elusive greenlight for the deal.

"I direct the Committee on Foreign Investment in the United States...to conduct a review of the acquisition of U.S. Steel by (Nippon Steel) to assist me in determining whether further action in this matter may be appropriate," the memo reads.

Nippon Steel said it was pleased by the news. "We have been confident from the outset that an objective, fact-based review of our proposed partnership with U.S. Steel will show that it strengthens American economic and national security," it said.

A spokesperson for U.S. Steel said the company looks forward "to continuing to work closely with President Trump and his administration to finalize this significant and important investment."

The White House directive sent the share price of U.S. Steel up nearly 14%, as investors took it to mean the administration was considering greenlighting the merger, which former President Joe Biden blocked in January on national security grounds.

After Biden's decision, the two companies sued CFIUS, which scrutinizes foreign investments for national security risks, alleging that Biden had prejudiced the committee's decision and violated the companies' right to a fair review.

They claimed Biden did so in 2024 by expressing opposition to the deal when he was running for re-election, to win the favor of the United Steelworkers (USW) union in the swing state of Pennsylvania, where U.S. Steel is headquartered.

Last month, the Trump administration filed a motion to extend two deadlines in U.S. Steel, and Nippon Steel's lawsuit against a U.S. national security panel to give the government more time to wrap up merger talks with the firms.