Japanese steel producer Nakayama Steel Works has announced that it will establish capital and business alliances with Japanese trading company Hanwa and steelmaker Yodoko to support the construction of its new electric arc furnace (EAF).
Nakayama Steel Works will raise JPY 8.69 billion ($55.1 million) through the third-party allotment of 5.70 million new shares to Hanwa and the disposal of 7.36 million treasury shares to Yodoko at JPY 666 ($4.22) per share. The estimated net proceeds of JPY 8.67 billion ($54.9 million) will be allocated entirely to the new EAF project between October 2026 and July 2030. The overall investment required for the project is estimated at approximately JPY 95 billion ($601.5 million) and may reach JPY 105.5 billion ($668 million).
Following the transaction, scheduled for early October 2026, Hanwa's voting rights will increase from 14.89% to 20.48%, making Nakayama Steel Works an equity-method affiliate of Hanwa, while Yodoko will become the company's second-largest shareholder with a 10.95% stake.
Under the alliances, Hanwa will cooperate with Nakayama Steel Works in raw material procurement, steel sales, recycling and carbon-neutral products, while Yodoko will support the development of higher-value-added EAF products and the expansion and stable supply of EAF-based hot rolled coils. Nakayama Steel Works expects the new furnace to replace most of the externally sourced slabs that currently account for approximately half of its slab requirements, strengthening supply security while reducing carbon emissions.
