Mitsui & Co., Nucor to Launch Steel Business JV

Mitsui & Co. and Nucor announced on Wednesday they signed agreement to establish 50/50 joint venture for steel related business including North American steel service center. They expand the service center business based on Steel Technologies, which Mitsui & Co.’s US subsidiary owns 100% of. They launch new service center in Mexico as the first step. They seek new business opportunities in steel related business in North America and worldwide by combining Nucor’s technology and Mitsui & Co.’s world network.

Mitsui & Co. contributes Steel Technologies into the new holding company, NuMit. Nucor purchases 50% share of NuMit. The transaction value is not disclosed. The transaction is subject to regulatory approvals and other conditions.

Mitsui & Co. will invest the proceeds from the share sales into steel businesses through NuMit. They will keep talking for new business opportunities other than steel service center. They eye steel upper stream and down stream operations in North America and other areas in the world. They could invest for integrated steel plant.

Steel Technologies, which will be part of NuMit, keeps the independent management and keeps sourcing from Nucor and other steel makers as before. With the wider sourcing, Steel Technologies keeps providing high grade processing and other services.

Steel Technologies launched new flat steel service center in Monterrey, Mexico under the new scheme while Nucor already announced the plan. The new service center will start operation with annual 200,000 tonnes of processing capacity in April 2011 to provide pickling, slitting and cutting service.

Mitsui & Co. acquired Steel Technologies in 2007 and has annual 2.5 million tonnes of operations through 23 bases in USA, Canada and Mexico. Steel Technologies is one of the top 5 service centers for automotive steel in North America. Mitsui & Co. and Nucor try to expand the service center network by combining their resources.