Nippon Steel, ArcelorMittal to buy US steel plant | business | Hindustan Times
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Nippon Steel, ArcelorMittal to buy US steel plant

business Updated: Nov 27, 2013 13:10 IST
Nippon Steel

The world's two biggest steelmakers Nippon Steel & Sumitomo Metal and ArcelorMittal are close to a $2 billion deal to buy a US steel plant from a German company, a report said Wednesday.

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

The two partners are making a joint bid for the plant in the state of Alabama that manufactures automotive steel sheets, 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. It 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.

Luxembourg-based ArcelorMittal and the Japanese giant already jointly produce steel for automobiles in 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.

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

Shares in Nippon Steel rose 0.60% to 333 yen by the midday break in Tokyo after the report, in an overall market that was modestly down.