TOKYO: Nippon Steel on Friday announced it will acquire two electric-furnace steelmakers in Thailand, G Steel and GJ Steel, in a deal that could reach about 88 billion yen ($772 million). Nippon Steel will use the acquisitions to strengthen its business in Southeast Asia and help reduce its carbon footprint. The acquisitions come as the Japanese company plans to reduce its capacity in Japan, where demand is declining. They will also help Nippon Steel accelerate its expansion into other Asian markets. News Desk
On Friday, Nippon Steel signed a share transfer agreement with Ares Management of the U.S., a major shareholder of the two Thai companies. It plans to purchase shares in the companies from Ares Management in February.
The Japanese steelmaker also plans to buy stock in the companies from other holders and turn the Thai steelmakers into a wholly owned subsidiary.
Both G Steel and GJ Steel have electric furnaces that emit less carbon dioxide than the blast furnaces that Nippon Steel has relied on. Electric furnaces melt iron scrap with the heat of electricity to produce steel products.
