On Tuesday, POSCO Holdings stated that it has initiated a bookbuilding process to divest 39.2 million shares of Nippon Steel through a block sale. The shares will be sold at a discount of 1.2% to 1.8% compared with the current price of 624 yen as of Friday. The sale, amounting to 24.2 billion yen, is being jointly managed by Bank of America and UBS.
In September, POSCO Holdings had sold about half of its shares in Nippon Steel for 25.3 billion yen. The company emphasized at the time that the sale was mutually agreed and would not affect the long-term workflow between the two companies.
The cross-shareholding structure between POSCO and Nippon Steel dates back to 1998. After POSCO’s privatization, the two companies strengthened their growth relationship by acquiring each other’s shareholders’ stakes. Over time, POSCO Holdings increased its stake in Nippon Steel to 1.5%, while Nippon Steel raised its stake in POSCO Holdings to 3.42%.
Last year, when Nippon Steel was planning to acquire US Steel, it divested its 3.42% stake in POSCO Holdings at a price of about 1.1.
POSCO Holdings is targeting to expand investments in energy and natural battery materials, such as rich nickel held by chairman Chang In-hwa. This potential operation continues to create resources for new growth projects by accelerating assets within its core business areas.
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