The Japanese steelmaker Nippon Steel Corporation (Nippon Steel) has announced that it has reached an agreement with another Japanese company Topy Industries to substantially strengthen their mutual alliance with the objectives of enhancing the competitiveness and increasing the corporate value of both companies.
Under the scope of the new agreement, the companies in question agreed to strengthen the competitiveness of Topy Industries through bringing its steelmaking facilities to state-of-the-art levels via renewal and expansion in the scale of its EAF and concasting equipment, and also the efficient joint use of the companies' steelmaking capabilities. The first goal is to be achieved through transition to in-house production of billets for small steel bars at Topy Industries, which are currently supplied by Nippon Steel to Topy Industries, while the latter one is to be achieved via use at Nippon Steel of blooms produced by the state-of-the-art electric furnace and continuous rolling facilities of Topy Industries.
In addition, Nippon Steel agreed to implement measures to strengthen competitiveness about integrating manufacture from steel-making to rolling of section steel in cooperation with Topy Industries, which has internationally top-class processing technology for deformed section steel.
Moreover, the companies decided to substantially strengthening joint development initiatives related to Topy Industries' automotive wheels and Nippon Steel's high-tensile strength steel sheets and continued stable supply from Nippon Steel of steel sheets for automotive wheel manufacturing. As for the steel supplies, Nippon Steel and Topy Industries agreed to continue the stable supply of specialty steel bars from Nippon Steel to Topy Industries for manufacturing undercarriage components for construction machinery; continue the stable supply of heavy and medium steel plates and H-beams from Nippon Steel to Topy Industries for use in bridge construction. The companies will also consider and implement joint responses to capture demand for section steel in China, the ASEAN region, and elsewhere.
In addition, Nippon Steel has decided to purchase the voting shares of Topy Industries up to 20 percent from the current 7.5 percent, and to clarify the position of Topy Industries as a Nippon Steel Group company and increase the smooth and secure operation of the present alliance.