Slovakian authorities seek Nippon Kosice plant clarification: reports

Slovakian Minister of Environment Tomáš Taraba and Minister of Economy Denisa Saková plan to visit Japan to meet with Nippon Steel representatives to obtain clarification on the Japanese steelmaker’s intentions for the Kosice steelworks, according to Slovakian media reports.

US Steel’s Kosice (USSK) plant will be part of the deal agreed by Nippon Steel last month to acquire US Steel for over $14 billion (see Kallanish passim). Taraba is concerned about the €600 million ($658m) his ministry offered to USSK for its transformation to low-emission steelmaking, according to reports.

“We need to know from the potential Japanese investor what it intends to do with the plant. There are too many people employed there to just wait for it to be finalised,” Taraba is quoted as saying.

Neither ministry’s spokespeople responded to request for comment on Friday.

A senior Czech steel industry representative indicated this could be a good opportunity for Nippon Steel to work with one of the Japanese carmakers in Central and Eastern Europe.

Nippon said it expects to close the US Steel acquisition in the second or third quarter of 2024. However, according to reports, the US national security review of the takeover is unlikely to conclude until late this year, potentially delaying the transaction.

USSK’s nine-month-through-September 2023 shipments fell 6% on-year to 2.88 million net tons, but raw steel production rose 1% to 3.3m nt. Ebit plummeted 95% to $25m.

The firm received last year €300m of EU Recovery and Resilience Facility funds from the Slovakian government for its plan to decarbonise by switching to electric arc furnaces.

Adam Smith Poland