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Nippon Steel, ArcelorMittal to buy US steel plant: Report

Published: 27th November 2013 02:57 PM  |   Last Updated: 27th November 2013 02:57 PM   |  A+A-

Lakshmi Mittal_AP

Lakshmi Mittal, CEO of world's largest steel-maker ArcelorMittal and one of the richest Indians, also owns two of the most expensive houses in London and has a large stake in a premier football club | AP/File photo

By PTI

The world's two biggest steelmakers, Nippon Steel & Sumitomo Metal and ArcelorMittal, are close to a USD 2 billion deal to buy a US factory from Germany's ThyssenKrupp, a report said Wednesday.

Nippon Steel of Japan and Luxembourg-based ArcelorMittal have reached a basic accord with ThyssenKrupp on the deal worth nearly 200 billion yen (USD 1.97 billion), the Nikkei economic daily said, without naming its sources.

The partners are making a joint bid for the plant in the state of Alabama that manufactures automotive sheet steel, aiming to more than double their combined production capacity in the United States, it said.

Nippon Steel declined to comment on the possible purchase, which could be its largest ever outside Japan. The firm became the world's second-biggest steelmaker following its merger with Sumitomo last year.

Without identifying possible buyers, ThyssenKrupp said this month that it was in exclusive negotiations on selling the state-of-the-art, but unprofitable plant which only came online in 2010.

Nippon Steel and ArcelorMittal will split the purchase costs evenly, with specifics to be fleshed out and announced in early December, the Nikkei said.

ArcelorMittal and the Japanese giant already jointly produce steel in the state of Indiana.

The yen's plunge against the dollar since late last year has improved Japanese automakers' income but Nippon Steel believes they will continue shifting automobile production overseas, the Nikkei said.

The firm started an automotive steel sheet factory in Mexico in August and in Thailand in October. Nippon Steel's Tokyo-listed shares closed 0.90 per cent lower at 328 yen after the report.



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