Nippon Steel's proposed acquisition of US Steel has raised concerns among shareholders about the potential increase in decarbonization costs for Japan's largest steelmaker.
Nippon Steel's Planned Acquisition of US Steel
According to Reuters, this comes after Nippon Steel announced a $15 billion bid for US Steel last year. However, the acquisition is facing resistance from a labor union and the White House.
The Australasian Centre for Corporate Responsibility (ACCR), an activist shareholder group with less than 1% of Nippon Steel's shares, expressed concerns about the impact of adding US Steel's 11 blast furnaces to the company's decarbonization expenses and climate goals.
In response to ACCR's concerns, Nippon Steel told Reuters that if the acquisition proceeds, it plans to share decarbonization technologies, such as hydrogen injection into blast furnaces, with US Steel. The company believes that combining technologies from both firms will speed up efforts to achieve carbon neutrality by 2050.
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Nippon Steel Shareholder Proposals
ACCR, with two other stakeholders, Corporate Action Japan (CAJ) and Legal & General Investment Management (LGIM), has filed shareholder proposals urging Nippon Steel to enhance its decarbonization strategy.
CAJ's chief executive, Yasunori Takeuchi, requested more information on the company's carbon emission targets to allow investors to accurately assess the overall risks and costs of decarbonization.
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