Nippon Steel Corp. will buy a 1.7 percent stake, possibly by the end of the year, in Usinas Siderurgicas de Minas Gerais SA, a major Brazilian steelmaker commonly known as Usiminas, Nippon Steel sources said Sunday.
The investment is intended to expand Nippon Steel’s supply capacity for Japanese automakers operating in South America, the sources said.
At the same time, the move is part of efforts by the top Japanese steelmaker to enhance its partnerships with foreign peers amid an accelerating worldwide realignment of the industry.
Mittal Steel Co. of the Netherlands, the world’s biggest steelmaker, agreed in July to merge with Arcelor SA of Luxembourg, the No. 2 firm, next spring.
In late October, Nippon Steel and POSCO, South Korea’s largest steelmaker, agreed to increase their cross shareholdings and step up their business alliance.
Usiminas was established in 1958 as a joint venture between Japanese and Brazilian companies.
Nippon Steel has indirectly invested in Usiminas through a 14.4 percent stake in Tokyo-based Nippon Usiminas Co., which owns 19.4 percent of the Brazilian steelmaker.
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