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Nippon may prevent Arcelor takeover
Steel maker Arcelor is trying to fight off an unsolicited $23 billion bid by Mittal.
A technology tie-up between Japan's Nippon Steel and Arcelor could enable the Luxembourg-based steel firm to fight off a takeover bid by Mittal Steel, a newspaper said on Sunday.
Under the agreement, Nippon Steel can prevent Arcelor from using technologies it has provided to the Luxembourg firm if it is taken over by another company, the English-language Daily Yomiuri said.
If Nippon Steel invoked the relevant clause, Arcelor would be a less attractive prospect for takeover, the newspaper said.
"If Arcelor was unable to use such techniques it would be unable to maintain product quality for steel provided to Japanese automakers' European plants and would quickly lose market share," the newspaper reported.
Arcelor, the world's second-biggest steel maker, is trying to fight off an unsolicited $23 billion takeover bid by Mittal, the world's largest steel maker.
The bid has been criticised by European politicians fearing job losses.
The heads of Arcelor and Nippon Steel met earlier this month but the Japanese firm was not asked to help fend off the Mittal bid, a Nippon Steel source said at the time.
The Arcelor and Nippon tie-up mostly covers technologies for high-grade steel sheets used in automobile production, Yomiuri said.
But it was unclear whether Nippon Steel would be willing to invoke the clause to prevent the use of the technology after a takeover because it could cause supply problems for Japanese automakers.
