Japan’s Sumitomo acquires Sweden’s Ovako (US)

Japan’s Nippon Steel & Sumitomo Metal Corporation said Monday that it completed the acquisition of Sweden’s Ovako Group on June 1, which will boost its special steel business and secure production and sales bases in Europe. “Demand of special steel is expected to grow further with firm demand from the automotive, industry machinery and wind power generation [sectors], so strengthening the special steel business [will] keep stable supply to customers,” a NSSMC spokeswoman said Tuesday. Ovako will continue to drive its business under the Ovako brand and will legally be part of NSSMC as a subsidiary, the companies said in a statement. Ovako announced March 15 that NSSMC had entered into an agreement to acquire 100% of Ovako Group from Triton. The parties have agreed not to make the terms and conditions of the transaction public.Ovako has become the first direct subsidiary to hold a production base in Europe, the NSSMC spokeswoman said. NSSMC will send over some personnel, including management and engineers, to strengthen the engagement, but details have yet to be decided, she said. NSSMC, Ovako and Sanyo Special Steel would be able to collaborate and expand their special steel business, the spokeswoman added. NSSMC had announced in March that the company had started discussions to explore opportunities to make Himeji-based Sanyo Special Steel a subsidiary of NSSMC, with completion targeted for March 2019. NSSMC holds 14.5% interest in Sanyo Special Steel. Ovako sold 780,000 mt of special steel in 2017 and Sanyo Special Steel sold 1.07 million mt of special steel in fiscal 2017-2018 over April 2017-March 2018. NSSMC does not disclose its special steel sales or production figures.

Source :

https://www.platts.com/latest-news/metals/tokyo/japans-nssmc-acquires-swedens-ovako-secures-steel-26968783

Posted in Merger & Acquisition.

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