Nippon Steel group’s major electric furnace steel maker, Godo Steel announced on Thursday the firm acquires Niigata based steel bar maker, Mitsuboshi Metal Industry by end of November. Godo Steel subscribes 417,000 share of Mitsuboshi Metal for 4.295 billion yen through third party allocation controlling 51% of Mitsuboshi Metal. Godo Steel tries to expand the concrete reinforcing steel bar business while the consolidation could stabilize the market in eastern Japan. Rebar makers’ profitability gets worse when rebar market is oversupply around Tokyo and Niigata and the market price is peaked. The consolidation could improve the oversupply condition and improve the supply side bargaining power against the buyers. Godo Steel, which was established in 1937 and posted 126.2 billion yen of sales for the year to March 2007, produces annual 1.47 million tonnes of H-beam, shapes, structural steel bar, rebar and wire rod at 3 plants in Osaka, Hyogo and Chiba. The firm produces rebar in Chiba. Mitsuboshi Metal, which was established in 1951 and posted 22.754 billion yen of sales for the year to March 2007, produces annual 410,000 tonnes of rebar in Niigata.
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