$2 bn deal: 'Lakshmi Mittal's ArcelorMittal, Nippon Steel set to buy ThyssenKrupp plant'

Nov 27 2013, 17:43 IST
Comments 0
Nippon Steel of Japan and Luxembourg-based Lakshmi Mittal's ArcelorMittal have reached a basic accord with ThyssenKrupp on the deal. Reuters Nippon Steel of Japan and Luxembourg-based Lakshmi Mittal's ArcelorMittal have reached a basic accord with ThyssenKrupp on the deal. Reuters
SummaryLakshmi Mittal's ArcelorMittal and Nippon Steel set to clinch deal to buy a US factory.

The world's two biggest steelmakers, Lakshmi Mittal's ArcelorMittal and Nippon Steel & Sumitomo Metal, are close to a USD 2 billion deal to buy a US factory from Germany's ThyssenKrupp, a report said Wednesday.

Nippon Steel of Japan and Luxembourg-based ArcelorMittal have reached a basic accord with ThyssenKrupp on the deal worth nearly 200 billion yen (USD 1.97 billion), the Nikkei economic daily said, without naming its sources.

The partners are making a joint bid for the plant in the state of Alabama that manufactures automotive sheet steel, aiming to more than double their combined production capacity in the United States, it said.

Nippon Steel declined to comment on the possible purchase, which could be its largest ever outside Japan. The firm became the world's second-biggest steelmaker following its merger with Sumitomo last year.

Without identifying possible buyers, ThyssenKrupp said this month that it was in exclusive negotiations on selling the state-of-the-art, but unprofitable plant which only came online in 2010.

Nippon Steel and ArcelorMittal will split the purchase costs evenly, with specifics to be fleshed out and announced in early December, the Nikkei said.

ArcelorMittal and the Japanese giant already jointly produce steel in the state of Indiana.

The yen's plunge against the dollar since late last year has improved Japanese automakers' income but Nippon Steel believes they will continue shifting automobile production overseas, the Nikkei said.

The firm started an automotive steel sheet factory in Mexico in August and in Thailand in October.

Nippon Steel's Tokyo-listed shares closed 0.90 per cent lower at 328 yen after the report.

Ads by Google
Reader´s Comments
| Post a Comment
Please Wait while comments are loading...