Nippon Steel Corporaton announced on 20 February it had reached agreement with Vallourec S.A. to increase its shareholdings in the French tube-maker through a rights issue, Kallanish notes.
Nippon Steel plans to subscribe to approximately 10% of Vallourec’s shares through the issue. Nippon Steel will invest up to €35 million in the purchase. The move is subject to the approval at Vallourec’s shareholders’ meeting on 20 April 2020.
Nippon Steel hopes to enhance and accelerate cooperation with Vallourec and its profitable pipes and tubes business. The two companies have been cooperating on OTCG and they jointly operate subsidairies in Brazil, USA and Asia.
In 2016, Nippon Steel & Sumitomo Metal Corporation (NSSMC) invested €350m to increasw its share in Vallourec to 15% from 1.5%. In the same year, the two companies accelerated the VAM premium joint development programmes, and expanded the scope of cooperation to include industrialisation and enhanced customer service capabilities.