Washington DC - President Donald Trump said Thursday it would be "hard" for him to agree to sell US Steel to Nippon Steel, but that he "feels better" about the Japanese giant acting as an investor instead.

"For a foreign country to buy that cherished US Steel brand, that's hard for me to do," Trump, who is reviewing Nippon Steel's proposed takeover after it was blocked by the Biden administration, told a televised cabinet meeting.

"They're coming back as an investor. And you know, I feel better about that I guess," he said.

Trump said Monday he had directed a government panel, the Committee on Foreign Investment in the US (CFIUS), to conduct a review of the acquisition.

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CFIUS, tasked with analyzing the national security implications of foreign takeover of US companies, has 45 days to submit its recommendations to Trump.

US Steel and Nippon Steel announced the proposed $14.9 billion merger in December 2023. It was originally meant to close by the end of 2024's third financial quarter.

However, months of scrutiny by US antitrust authorities and CFIUS – which failed to reach a consensus for its recommendation – forced then-President Joe Biden to make a decision on the deal himself.

Biden had criticized the deal for months, while holding off on a move that could hurt ties with Tokyo, but he blocked it in his last weeks in office on national security grounds.

The two firms then filed a lawsuit against the Biden administration's "illegal interference" in the transaction.

The review Trump ordered on Monday involves "identifying potential national security risks associated with the proposed transaction and providing adequate opportunity to the parties to respond to such concerns," his memo said.

Trump said during his 2024 campaign he wanted US Steel ownership to remain in the US.

In February, after meeting Japan's prime minister, Trump said Nippon Steel would make a major investment in US Steel, but no longer attempt to take over the troubled company.