Nippon Steel Will Pay Decarbonization Costs With U.S. Steel Takeover

Nippon Steel's proposed acquisition of US Steel risks raising decarbonization costs for Japan's top steelmaker, an activist shareholder group said, urging the company to address the takeover's impact on its climate goals, Katya Golubkova reported for Reuters.

Nippon Steel last year announced a $15 billion takeover offer for US Steel. I Photo: m-louis .® Flickr

Nippon Steel, the world's fourth-biggest steelmaker, last year announced a $15 billion takeover offer for US Steel, which backed the bid but has faced resistance from a powerful labor union and the White House.

"The potential addition of US Steel's 11 blast furnaces to Nippon Steel's operations will almost certainly increase the cost of decarbonization for the company," Brynn O'Brien, executive director of the Australasian Center for Corporate Responsibility (ACCR), said.

ACCR, which has less than 1% of Nippon Steel's shares, has filed shareholder proposals with two other stakeholders, Corporate Action Japan (CAJ) and Legal & General Investment Management (LGIM), calling on the company to improve its decarbonization strategy.

Asked about ACCR's concerns, Nippon Steel told Reuters it planned to share technologies related to decarbonization, including hydrogen injection into blast furnaces, with US Steel should the deal close.