Global steelmakers Ternium and Nippon Steel & Sumitomo Metal Corporation (NSSMC) have reached an agreement this week to end five years of legal disputes involving Brazilian flats producer Usiminas, the company said late Thursday.
Under the terms of the agreement, the two Usiminas investors agreed to establish certain “new rules” regarding their relation as shareholders and members of the Brazilian steelmaker’s control group, as well as end pending legal disputes.
The two shareholders set, among other things, amendments to the existing shareholder agreement, the right to nominate the chairman of the board of directors, and the rules needed to compose and appoint the executive board.
Both Ternium and NSSMC will have the right to appoint the chairman of the board of directors and the Usiminas CEO for two consecutive two-year terms.
NSSMC will appoint the chairman, while Ternium will name the CEO for the next two-year terms, from April/May 2018 to April/May 2020, and then April/May 2020 to April/May 2022. At the end of each two-year term, the companies will alternate power on choosing the chairman and the CEO.
The two companies also agreed that the executive board will be composed of six members, including the CEO.