According to Japan’s Nippon Steel, a technology tie-up between Nippon Steel Corp. and Arcelor could enable the Luxembourg-based steel firm to fight the takeover bid by Mittal Steel. Under the agreement, Nippon Steel can prevent Arcelor from using technologies it has provided to the Luxembourg firm if it is taken over by another company, an English daily reported. If Nippon Steel invoked the relevant clause, Arcelor would be a less attractive prospect for takeover. If Arcelor is unable to use such techniques it would be difficult to maintain product quality for steel provided to Japanese automakers’ European plants and would quickly lose market share, the newspaper reported. The Arcelor and Nippon tie-up mostly covers technologies for high-grade steel sheets used in automobile production. It is unclear at the moment whether Nippon Steel is willing to invoke the clause to prevent the use of the technology after a takeover because it could cause supply problems for Japanese automakers.
