The merger between Nippon Steel Corp and Sumitomo Metal Industries may become even more wide-spreading after it emerged that they may invite Kobe Steel Ltd to join the merger.
Sumitomo Metal’s chairman commented “It will be difficult to merge with Kobe with the current business structure” that holds aluminum, construction machinery and plants, chairman Hiroshi Shimozuma told reporters in Kyoto, western Japan. ““If Kobe can make a decision to separate steel division, there will be another story.”
While Kobe Steel are currently issuing no comments on the invitation, many market analysts believe that it is only a matter of time before they accept, with Shinya Yamada, an analyst at Credit Suisse Securities Japan Ltd, claiming “The steel industry is likely to consolidate further if the planned merger of Nippon Steel and Sumitomo Metal is approved and goes well.”