Nippon Steel will raise its stake in affiliate Sanyo Special Steel to 15% in the latest cross-shareholding move seen in part as defending against hostile takeovers.The two companies said Nippon Steel, the worlds third biggest steel maker ,will purchase treasury stock in Sanyo Special Steel to boost its stake by the end of June, making Sanyo Special an affiliate. Sanyo plans to buy a similar number of shares in Nippon Steel.
The two companies said they will study possible tie-ups in various areas ,including consignment production and cutting costs in procuring raw materials. "Anticipating future changes in steel demand and growing international competition, this collaboration plans to provide both Nippon Steel with benefits through implementation of specific collaboration measures," they said in a statement. Nippon Steel owns 11.2% of Sanyo Special Steel, which produces steel used in auto parts.
Japanese Steel makers shares have risen recently of speculation on consolidation in the industry after Mittal, the worlds biggest steel maker ,made a $2.3bn hostile takeover bid for No 2 Arcelor last month. Nippon Steel Metal Industries and Kobe Steel, have recently raised their mutual cross share holdings.
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| Posted : 2/15/2006 |
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