Nippon Steel Allows Ternium to Join Usiminas

Nippon Steel announced on Monday the firm reached new shareholders agreement on the equity method affiliate, Usinas Sider?rgicas de Minas Gerais S.A. (Usiminas) of Brazil. Luxemburg based Latin American major steel maker, Ternium group purchases 27.66% share in Usiminas for 5.029 billion real to join the new shareholders agreement. Nippon Steel purchases additional share in Usiminas to keep top shareholder status. The new controlling shareholders improve Usiminas’ management while Nippon Steel, Usiminas and Ternium enter into strategic alliance for their better competitiveness.

Nippon Steel purchases more than 8.52 million shares or around 1.69% in Usiminas for 36 real per share from Caixa dos Empregados da Usiminas (CEU) or pension fund of Usiminas’ employees. The price is around 41% higher than Usiminas’ last six months average share price. Nippon Steel and the subsidiary, Nippon Usiminas keep the top shareholders in Usiminas.

Ternium group purchases more than 139.7 million shares in Usiminas for 36 real per share from existing Usiminas’ controlling shareholders of Camargo Corr?a, Votorantim and CEU. The shareholding is 84.7 million shares for Ternium, 30 million shares by Siderar, which is Argentine subsidiary of Ternium, and 25 million shares by Confab Industrial, which is subsidiary of Tenaris.

With new controlling shareholders composition, the shareholders renewed shareholders agreement. The controlling shareholders have 322.7 million shares or around 63.86% of Usiminas. Nippon Steel group including Mitsubishi Corporation and Metal One has 46.12% share in the controlling group with 43.31% share by Ternium group and 10.57% by CEU.

The transaction is to restructure the shareholders composition for Usiminas to execute long term strategy. Nippon Steel, Usiminas and Ternium group enter into strategic alliance for better competitiveness in technology, quality and cost efficiency.