August 3, 2021

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ContactTelephone: Nippon Steel Corporation: Eiji Hashimoto
Representative Director and President: First Section of Tokyo Stock Exchange, and Nagoya,Fukuoka and Sapporo Stock Exchanges: 5401: Public Relations Center, General Administration Div.
: +81-3-6867-2135, 2146, 2977, 3419

Notice regarding Partial Disposition of Tokyo Rope Mfg. Co., Ltd.’s Shares (Planned)

Nippon Steel Corporation announced the subject of the title.
Please refer to the following pages for details.

August 3, 2021
Nippon Steel Corporation

Notice regarding Partial Disposition of Tokyo Rope Mfg. Co., Ltd.’s Shares (Planned)
On January 21, 2021, the board of directors of Nippon Steel Corporation (“NSC”) adopted a resolution
to acquire shares of common stock of Tokyo Rope Mfg. Co., Ltd. (“Tokyo Rope”) (“Tokyo Rope Shares”)
through a tender offer (the “Tender Offer”) under the Financial Instruments and Exchange Act of Japan(Act No. 25 of 1948, as amended). NSC commenced the Tender Offer on January 22, 2021, and as aresult of the completion of the Tender Offer on March 8, 2021, NSC came to own 3,236,535 Tokyo RopeShares (ownership ratio after the Tender Offer (Note): 19.91%). After the completion of the Tender Offer,
the Japan Fair Trade Commission (the “JFTC”) indicated that a joint relationship would be formed
between NSC and Tokyo Rope. NSC hereby announces that following discussions with the JFTC, NSC
has come to a decision to sell part of its Tokyo Rope Shares.
(Note) The ratio of NSC’s Tokyo Rope Shares against 16,255,173 shares, which is the total number ofissued shares (16,268,242 shares) as of September 30, 2020 stated in the Second QuarterlyReport for the 222nd Fiscal Year submitted by Tokyo Rope on November 13, 2020, reduced by
the number of treasury shares (13,069 shares) owned by Tokyo Rope as of the same date(rounded off to two decimal places).
1. Indication by the JFTC
The Act on Prohibition of Private Monopolization and Maintenance of Fair Trade (Act No. 54 of 1947; asamended; the “Antimonopoly Act”) and the Guidelines to Application of the Antimonopoly Act
Concerning Review of Business Combination (the “Application Guidelines”) stipulate that when the ratioof the total number of voting rights pertaining to shares after share acquisition does not exceed 20%,prior notification to the JFTC is not required and that when the ratio of the total number of voting rights
pertaining to shares after share acquisition exceeds 10%, the JFTC determines whether there is “arelationship in which two or more companies operate a business in a united form, whether fully orpartially, by shareholding, mergers or other transactions” (a ”joint relationship”), taking into account,among other factors, “the rank as a holder of voting rights, differences in and distribution of the ratios ofvoting rights held among the holders, and other relationships between holders” and if such arelationship is found, the JFTC reviews, on its own authority, whether the joint relationship “substantiallyrestrains competition in any particular field of trade” (Article 10, paragraph (1) of the
Antimonopoly Act) (Note).

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The Tender Offer conducted by NSC made its ownership ratio of Tokyo Rope Shares 19.91%.
Subsequently, after discussions with NSC, Tokyo Rope submitted a proposal concerning changes to allof its directors and some audit & supervisory board members to its annual shareholders meeting on
June 25, 2021, and the proposed changes were implemented by resolution at said shareholders
meeting. NSC set the maximum number of shares to be purchased in the Tender Offer taking into
account considerations including, among others, maintaining the independence of Tokyo Rope’smanagement by not making Tokyo Rope an affiliate of NSC accounted for by the equity method.
Consequently, the ratio of voting rights of NSC after the Tender Offer was 19.91%, and the Tender Offer
was therefore not subject to prior notification requirements. After the completion of the Tender Offer, theJFTC indicated, on the premise of the ratio of voting rights held by NSC after the Tender Offer having
exceeded 10% and taking into account the fact that the changes to the directors and audit &supervisory board members were proposed at the annual shareholders meeting of Tokyo Rope andwere implemented by resolution at said shareholders meeting, that a joint relationship would be formed
between NSC and Tokyo Rope.
(Note) The Application Guidelines stipulate that “when the ratio of the total number of voting rights
pertaining to shares held by companies, etc. that belong to the group of combined companies towhich the shareholding company belongs to all of the voting rights of the share issuing company
exceeds 50%” and “when the ratio of the total number of voting rights pertaining to shares heldby companies, etc. that belong to the group of combined companies to which the shareholding
company belongs to all of the voting rights of the share issuing company exceeds 20% and thesaid ratio stands alone as the top-ranked,” “a joint relationship …[will] be formed, maintained orstrengthened,” which requires a business combination review; in addition, when “the ratio ofvoting rights held is 10% or less or and the shareholding company is not ranked among the top
three holders of voting rights,” the case “does not require a business combination review”; on
the other hand, in other cases, although “it is considered that most of the cases do not requirebusiness combination review in general,” the JFTC determines whether there is a joint
relationship by taking into account, among other factors, “the rank as a holder of voting rights,
differences in and distribution of the ratios of voting rights held among the holders, and otherrelationships between holders”; if such a relationship is found, the JFTC reviews, on its own
authority, whether the joint relationship “substantially restrains competition in any particular fieldof trade” (Article 10, paragraph (1) of the Antimonopoly Act).

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2. NSC’s decision and response
In conducting the Tender Offer, NSC explained that the purpose thereof was to contribute to therecovery and improvement of Tokyo Rope’s corporate value by increasing NSC’s commitment toimprovement of Tokyo Rope’s corporate value and encouraging Tokyo Rope to restructure its
management and governance systems, which would be necessary to recover and improve its corporate
value, while maintaining the independence of its management, in view of the situation where TokyoRope, despite its management issues including dysfunction of its governance system, had not taken
any effective measures against them.
After the completion of the Tender Offer, aiming for restructuring the management and governancesystems of Tokyo Rope, which would be necessary to realize the recovery and improvement of its
corporate value and of shareholders’ common interests as quickly as possible, NSC, as its shareholder,
had earnest discussions with Tokyo Rope’s management regarding the appointment of new internal
persons as directors of Tokyo Rope and a structure for the board of directors which would ensure
independence and diversity. Following discussions with NSC, Tokyo Rope decided on its own to submit
to its annual shareholders meeting a proposal concerning changes to all of its directors and some audit& supervisory board members, and the proposed changes were implemented by resolution at said
shareholders meeting. As a result, Tokyo Rope’s management team fundamentally changed through ageneration change, its corporate governance was strengthened, and a majority of its board of directors
became independent outside directors, ensuring diversity.
Based on the JFTC’s indication, NSC proposed to the JFTC that it would take the following measures(1) through (3) in relation to the Tokyo Rope Shares held by NSC. This proposal was made taking into
account considerations including, among others, the following: (i) part of the main purpose of theTender Offer, namely, restructuring of Tokyo Rope’s management and governance systems, which
would be necessary to recover and improve Tokyo Rope’s corporate value, has been achieved with thesupport of other shareholders, as stated above; (ii) future recovery and improvement of Tokyo Rope’scorporate value is considered feasible with NSC’s assistance stated in 3. below, regardless of thenumber of Tokyo Rope Shares held by NSC; and (iii) NSC has continued to believe that independenceof the Tokyo Rope’s management should be maintained, and that if Tokyo Rope can fully demonstrate
its inherent technological capabilities and brand power, ‘its corporate value can be recovered andimproved on its own, and considers that the recovery and improvement of Tokyo Rope’s corporate
value will be facilitated by ensuring, in a situation where no joint relationship is considered to exist
between NSC and Tokyo Rope, the flexibility of Tokyo Rope’s management and avoiding possible
delays in or problems with the swift rebuilding of Tokyo Rope’s business.

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(1) NSC will sell 1,625,500 Tokyo Rope Shares so that the ratio of voting rights of Tokyo Rope Shares
held by NSC should be 10% or less such that “a joint relationship is not formed, maintained orstrengthened so that ...[it] does not require a business combination review” as stated in theApplication Guidelines.
(2) NSC will sell Tokyo Rope Shares until the number of shares sold reaches the number stated in (1)above, where the sale price would be 1,500 yen (which was the Tender Offer Price) or more pershare and when and in such amounts that the stakeholders of Tokyo Rope, including shareholders,business partners, and employees, as well as the securities markets, could reach anunderstanding that the recovery and improvement of Tokyo Rope’s corporate value, which was theultimate purpose of the Tender Offer, has been achieved, in as short a time as possible.
(3) Until the sale of the number of shares stated in (1) above is completed, NSC will exercise voting
rights at Tokyo Rope’s shareholders meeting only to the extent that the number of voting rights
exercised by NSC will be 10% or less of the number of voting rights (excluding the number ofvoting rights not exercised by NSC) of all shareholders as of the end of the previous fiscal year,
and will refrain from exercising voting rights beyond that extent, provided that, after the sale ofTokyo Rope Shares, NSC may exercise its voting rights upon instructions of a new shareholder if
the new shareholder is unable to exercise the voting rights by reason of record date.
3. NSC’s assistance for Tokyo Rope
As stated above, based on the JFTC’s indication, NSC will sell Tokyo Rope Shares under the conditionsin 2. above. As the largest shareholder of Tokyo Rope, which position NSC continues to maintain, andas the largest base material supplier and a joint development partner, NSC hereby reconfirms that NSC
will cooperate with Tokyo Rope, which commenced new management and governance systems
following its shareholders meeting held in June this year, in its efforts to appropriately address
management issues and to recover its competitiveness in the markets in and outside Japan andimprove its business results, and will contribute to the recovery and improvement of Tokyo Rope’s
corporate value.
4. Impact on Business Results
The impact of this matter on NSC’s business result will be minor.
EndFor inquiries
Public Relations Center

Tel.: +81-3-6867-2135, 2146, 2977, 3419

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