On February 10, Japanese steel giant Nippon Steel Corporation (Nippon Steel) announced that it has decided to increase its holding ratio of shares (with voting rights) in ferroalloy producer Nippon Denko from the present 9.5 percent to 15 percent, upon completion of which Nippon Denko will become an equity method affiliate of Nippon Steel.
The decision came after the companies' agreement on further strengthening their alliance, in order to enhance their respective competitive edge and corporate values.
According to Nippon Steel, the two companies, which have been maintaining a close business relationship through trade in manganese ferroalloy, will strive to construct a system that enables proper response to further changes in the materials environment in the future and will endeavor to strengthen their respective business foundations through the alliance.
With the new agreement, the companies seek to stabilize procurement of raw materials (including manganese ore) for Nippon Denko, provide assistance to Nippon Denko from Nippon Steel and its group companies concerning the development of Nippon Denko's overseas business; to promote cost reduction in the raw materials procurement and product distribution; and to conclude a long-term sales and purchase agreement for ferromanganese produced by Nippon Denko.