S&C Advises Nippon Steel on Joint Ventures with ArcelorMittal

December 22, 2020

On December 9, Nippon Steel Corporation (NSC) completed its transfer to ArcelorMittal S.A. of NSC's partnership interests in two joint ventures of over 30 years between NSC and ArcelorMittal to operate steel products finishing facilities in Indiana. In connection with ArcelorMittal's announced sale of its U.S. steel mill operations to Cleveland-Cliffs Inc., which included ArcelorMittal's 50 percent and 60 percent interests in these joint ventures, NSC exercised its put options to sell its 50 percent and 40 percent interests in these joint ventures to ArcelorMittal. These were concurrently sold to Cleveland-Cliffs Inc. so that Cleveland-Cliffs became the sole owner of the joint ventures.

Following the transactions, NSC and ArcelorMittal have agreed to jointly concentrate their resources on another joint venture in Alabama to operate one of the world's most advanced steel finishing facilities. At the Alabama joint venture, called AM/NS Calvert LLC, ArcelorMittal, NSC and Calvert plan to construct an electric arc furnace and related facilities requiring capital expenditures of approximately $750 million, under agreements that are anticipated to be entered into before the end of 2020.

The S&C team advising NSC on these transactions was led by Robert DeLaMater. Nader Mousavi and special counsel Mark Schenkel are advising on intellectual property matters; Steven Holley, Adam Paris and special counsel Brad Smith are advising on antitrust matters; Presley Warner (London) is advising on financing arrangements; and Jeff Hochberg and special counsel Saul Brander are advising on certain tax matters.