Dubai: Japanese steelmaker Nippon Steel Corporation (NSC) has acquired a stake in Al Ghurair Iron and Steel (AGIS), a subsidiary of the Al Ghurair Group.
The move will help AGIS expand its galvanising capacity, a statement said.
"The agreement brings the strengths of NSC and AGIS, by leveraging NSC's technical strengths and global network and AGIS's local industry and market expertise to deliver high quality galvanised steel in a very cost effective and efficient manner to customers in the region," a joint statement said.
NSC has signed an agreement for equity investment in AGIS through a share transfer in which NSC will secure 20 per cent of voting rights in AGIS.
The Al Ghurair Group, through its investment company — SAG Investments and Trading LLC — now holds 80 per cent shares in AGIS.
The formal agreement was signed by Majid Saif Al Ghurair, Managing Director of SAG Investments & Trading LLC, and Shinya Higuchi, Managing Director of NSC on Sunday in Dubai.
"NSC's technical strengths and resources will be of great benefit, particularly during our upcoming expansion programme to double our galvanising capacity," said Abu Bakr Hussain, CEO of AGIS.
AGIS, which employs 365 people, last year recorded Dh728 million turnover. Nippon Steel, which has a turnover of $49.4 billion, employs more than 16,150 people. "By teaming up with one of the leading top-tier global steelmakers, AGIS will be able to leverage NSC's global network and vast resources to enhance its presence and impact a larger audience both locally and regionally," Hussain said.
"We are pleased to combine our strengths to meet the growing demands of the marketplace."
According to Dr Abdul Hamid Radwan, an econ-omic expert, such a strategic alliance is very important to grow with the local iron and steel industry as well as expand the customers network.
"Looking from an econ-omic perspective, this kind of partnership will help transfer the latest technology as well as nationalise the knowhow and modernise these technologies to serve the industrial sector."
Radwan said this partnership will not only deliver a better quality product but also enforce new tools in the industrial sector. "The UAE is an open market and the alliance between AGIS and NSC will help the local steel production to find new markets."
New board of directors
The new Board of Directors of AGIS comprises of Majid Saif Al Ghurair, Ahmad Hussain Lafir, Saeed Saif Al Ghurair, Abu Bucker Hussain & Hideki Ogawa.
"Majid Al Ghurair continues to be the Chairman of the Board of Directors of AGIS. There will be no change in the day-to-day management of the company and Abu Bucker Hussain shall continue as the Chief Executive Officer of AGIS," the statement said.
