Nippon to buy Sumitomo, create No. 2 steelmaker | business | Hindustan Times
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Nippon to buy Sumitomo, create No. 2 steelmaker

business Updated: Feb 03, 2011 22:51 IST
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Japan’s Nippon Steel Corp and Sumitomo Metal Industries plan to merge to create the world’s second-largest steelmaker as they battle tough competition from Asian rivals and shrinking demand from domestic automakers.

The deal, which would likely see Japan’s top steelmaker Nippon Steel acquiring Sumitomo Metal, valued at $11 billion, comes as the industry grapples with surging prices for steelmaking ingredients iron ore and coking coal.

Japanese steelmakers have been hard hit as domestic automakers such as Toyota Motor Corp and Nissan Motor Co build fewer cars at home and expand in emerging markets such as India using steel from local producers. Reuters