Nippon Steel & Sumitomo Metal Corp. said March 15 that it struck a deal to acquire Swedish specialty steelmaker Ovako AB, without disclosing the terms.
The transaction is expected to close in the first half of its fiscal 2018, subject to a review of competition authorities.
Ovako sold 780,000 tonnes of steel in 2017, generating revenue of €921 million.
Nippon Steel said it was looking to strengthen its technology, product quality and product development capability for special steel with the planned takeover.
Reuters reported that the acquisition will add 780,000 tonnes of steel production to Nippon Steel's annual output of about 45 million tonnes.
The company separately said it began talks with Sanyo Special Steel Co. to increase its stake in the latter to more than 51% from 14.5% and make it a subsidiary.
The parties intend to sign a definitive agreement in August and conclude the deal by March 2019.
According to Reuters, Nippon Steel will need to pay about ¥29 billion to raise its stake in Sanyo Special Steel to at least 51%.
Earlier in March, Nippon Steel and JFE Holdings Inc. announced plans to invest more than US$20 billion over the next three years to overhaul plants in a bid to reduce costs and increase the output of high-quality metal.
As of March 14, US$1 was equivalent to ¥106.17.
