January 21st, 2021
Company name:
Representative:
Stock listing:Code number:Contact:

NIPPON STEEL CORPORATION
Eiji Hashimoto
Representative Director and President
First Section of Tokyo Stock Exchange, and Nagoya,Fukuoka and Sapporo Stock Exchanges
5401
Shinnosuke Arita, General Manager, Public Relations
Center(Telephone: +81-03-6867-2135, 2146, 2977, 3419)

To whom it may concern:
Notice Concerning Acquisition of Shares of G Steel Public Company Limited and G J Steel Public Company
Limited in Thailand (to Make Them Subsidiaries)

NIPPON STEEL CORPORATION (“NSC” or the “Company”) hereby announces that, today, it has decided to enter
into a share purchase agreement (“SPA”) to acquire 49.99% shares in G Steel Public Company Limited (“G Steel”)
and 49.90% shares in G J Steel Public Company Limited (“G J Steel”), which are integrated steel production mills that
produce hot-rolled steel sheets from electric arc furnaces in Thailand, from Kendrick Global Limited (“Kendrick”), anentity owned by funds managed by Ares SSG, an alternative asset manager in Asia-Pacific.
1. Overview and Means of Acquisition
Based on the SPA, the Company will acquire 100% shares in Asia Credit Opportunities I (Mauritius) Limited (“ACOI”), a special purpose company which holds 49.99% shares of G Steel and 40.45% shares of G J Steel, from Kendrick(the “Transaction”). In addition to the 40.45% shares in G J Steel held by ACO I, G Steel, together with its subsidiaries,
holds 9.45% of G J Steel shares, and NSC acquires 49.90% of G J Steel shares in total as a result of the Transaction.
After the Transaction is completed, NSC will have an effective control over G Steel and G J Steel and consolidate G
Steel and G J Steel as subsidiaries of NSC.
The Transaction is expected to be completed as soon as the preconditions for the Transaction are satisfied (February2022 expected). Furthermore, given that G Steel and G J Steel are listed on the Stock Exchange of Thailand, inaccordance with the regulations of The Securities and Exchange Commission of Thailand, NSC will launch amandatory tender offer (MTO) for the remaining shares of both G Steel and G J Steel in a timely manner.
2. Rationale for the Transaction
Global steel consumption is expected to continue to grow steadily to 2025 and further to 2030. NSC has developed
its business mainly in Asia especially China, the ASEAN countries and India, where the market size and growth rate
are large in global terms and NSC is in an advantageous position to be able to lead the market size and growth to NSC’s
earnings growth. In line with the “Medium- to Long-term Management Plan” released last year, NSC sets its vision toachieve “100 million tons of global crude steel capacity per annum” through expanding local integrated steel
production in growing overseas market, and has been considering acquisition of, and equity participation (brownfieldinvestment) in integrated steel mills in the ASEAN countries and others.

Amongst the ASEAN countries, Thailand has been an essential market for NSC, where NSC has established
downstream mills product processing bases since 1960’s, to meet demand of high-quality steel from local automotive
and home appliance manufacturers, NSC has been supplying semi-finished products from Japan, which are then further
processed locally at NSC’s cold-rolling, coating and other processing facilities at its subsidiaries and supplied as final
products to local manufacturing companies.
On the other hand, the demand for general-purpose flat steels, market size of which is large as well as high quality
steel, is also expected to grow steadily in Thailand. As the trend of “favoring domestic production” accelerates all over
the world, it is important to become an insider in order to capture the demand of general-purpose products in Thailand,
and this is the reason that NSC has been considering securing local integrated steel production through M&A and othermeans.
Both G Steel and G J Steel are the only steel companies which have integrated steel production facilities from electricarc furnaces to hot-rolling processes in Thailand, and they manufacture and sell general grade hot-rolled steel products
which constitute the largest market segment. Together, the two companies have a hot-rolled production capability of
approximately 3 million tons and have sold hot-rolled steel products for general-purpose, such as for domestic
construction industries in Thailand. NSC has decided that this opportunity is worthwhile to invest since the electric arc
furnaces are suitable for the demand of hot-rolled steel in Thailand, and from the perspective that it will be a future
potential development base for promoting “High-grade steel production in electric arc furnaces” which is one of ourthree initiatives of Carbon Neutral Vision 2050.
NSC will capture hot-rolled steel demands in Thailand, which is expected to grow steadily, by utilizing themanagement base of G Steel and G J Steel for manufacturing and sales as well as improving their productivity andquality.
3. Overview of the Target Companies
3-1. G Steel Public Company Limited(1)

NameG Steel Public Company Limited(2)

Location

88 PASO Tower, 18th Floor, Silom Road, Suriyawong, Bangrak, Bangkok,
Thailand 10500(3)

Name and Title ofRepresentative

Christopher Michael Nacson, Chairman of Board of Directors(4)

Description of Business

Manufacturing and Sales of Hot Rolled Steel Sheets(5)

Capital144,644 million Baht

(6)

Date of Establishment

October 31, 1995

(7)

Major Shareholders andOwnership Percentage

Asia Credit Opportunities I (Mauritius) Limited: 49.99%

(8)

(9)

Relationship Between theCompany and SaidCompany

Capital Relationship

Not applicablePersonnelRelationship

Not applicable

Business
Relationship

Not applicable

Consolidated operating results and consolidated financial positions of said company for the last three years
As of / The year ended

December 31, 2018

December 31, 2019

December 31, 2020

Net assets

10,101

17,182

15,934

Total assets

30,632

26,40025,460

1.47

1.98

0.55

Net sales

29,966

17,416

20,693

Profit (Loss) before
taxation(2,358)1,457(1,203)

Net assets per share (Baht)

Profit (Loss) for the year(2,358)

1,457(1,203)

Profit (Loss) attributable toowners of the parents(1,662)

2,646

(655)

Earnings (Loss) per share(Baht)(0.24)

0.31(0.02)

n/an/an/aDividend per share(Million Baht, unless otherwise noted)
3-2. G J Steel Public Company Limited
(1)

Name

G J Steel Public Company Limited(2)

Location

88 PASO Tower, 24th Floor, Silom Road, Suriyawong, Bangrak, Bangkok
10500

(3)

Name and Title ofRepresentative

Stephen Karl Stewart, Chairman of the Board of Directors(4)

Description of Business

Manufacturing and Sales of Hot Rolled Steel Sheets(5)

Capital24,468 million Baht

(6)

Date of EstablishmentJanuary 5, 1994

(7)

Major Shareholders andOwnership Percentage

Asia Credit Opportunities I (Mauritius) Limited : 40.45%
G Steel Public Company Limited : 8.24%
GS Securities Holdings Co., Ltd : 1.21%

(8)

(9)

Relationship between theCompany and SaidCompany

Capital Relationship

Not applicable

PersonnelRelationship

Not applicable

BusinessRelationship

Not applicable

Operating results and financial positions of said company for the last three years
As of / The year ended

December 31, 2018

December 31, 2019

December 31, 2020

Net assets

13,21813,294

12,661

Total assets

18,82415,488

14,857

0.95

0.61

0.50

Net sales

29,91012,923

11,379Loss before taxation(836)(1,353)(605)

Loss for the year

(836)

(1,353)(605)

Loss per share (Baht)(0.060)(0.063)(0.024)n/an/an/a

Net assets per share (Baht)

Dividend per share (Baht)(Million Baht, unless otherwise noted)
4. Overview of the Counterparty to the Acquisition of Shares
(1)

Name

Kendrick Global Limited(2)

Location

Ritter House, Wickhams Cay II, PO Box 3170, Road Town, Tortola VG1110,
British Virgin Islands(3)

Basis of Establishment, etc.

A Limited company under British Virgin Island Business Companies Act(4)

Purpose of Formation

Investment holding entity with primary purpose for its investments in Asia Credit
Opportunities I (Mauritius) Limited, shareholder of G Steel and G J Steel, andLink Capital I (Mauritius) Limited, creditor of G Steel and G J Steel(5)

Date of Formation

June 28, 2016

(6)Total Investment AmountUSD 100 share capital(7)

Owners, Ownership
Percentages and Overview
of the Owners

Investment funds managed by Ares SSG

(8)

(9)

(10)

Overview of OperatingPartnersOverview of Japanese
Agent

Relationship between theCompany and Said FundNameKendrick Global Limited

Location

Ritter House, Wickhams Cay II, PO Box 3170, RoadTown, Tortola VG1110, British Virgin Islands

Name and Title ofRepresentative

Embree Capital Limited, Director
Monique Adams, Director
James Raymond Wearmouth, Director

Description ofBusiness

Investment holding entity with primary purpose for its
investments in Asia Credit Opportunities I (Mauritius)
Limited, shareholder of G Steel and G J Steel, and Link
Capital I (Mauritius) Limited, creditor of G Steel and GJ Steel

Capital100 USD

Not applicableRelationship between
the Company and
Said Fund

Not applicable

Relationship between
the Company andOperating Partners

Not applicable

Relationship between
the Company andJapanese Agent

Not applicable

5. Number of Shares to be Acquired, Acquisition Costs and Shareholding before and after Acquisition
Number of Shares Held
before the Change0 shares(Number of voting rights: 0 units)(Ratio of voting rights held: 0.0%)(2)

Number of Shares to beAcquired

G Steel: 14,461,489,473 shares(Number of voting rights: 14,461,489,473 units)
G J Steel: 10,310,359,336 shares and NVDR*1 of 204,485 units(Number of voting rights: 10,310,359,336 units)(3)

Acquisition Value

Common shares of G Steel: 117 million USD
Common shares and NVDR of G J Steel: 183 million USD

Number of Shares Held
after the Change

G Steel:
14,461,489,473 shares(Number of voting rights: 14,461,489,473 units)(Ratio of voting rights held: 49.99%)
G J Steel:
10,310,359,336 shares and NVDR*¹of 204,485 units(Number of voting rights: 10,310,359,336 units)(Ratio of voting rights directly held: 40.45%, total of directly and indirectly
held: 49.90%*2)

(1)

(4)

*1: Non-voting depository receipt, is a trading instrument issued by Thai NVDR.
*2: the number including the total shares of G J Steel held directly and indirectly by G Steel
6. Timetable(1)

Definitive Agreement

January 21, 2022

(2)

Closing

February, 2022 (Expected*3)*3: The Transaction is expected to be completed as soon as the preconditions for the transfer are satisfied.
We expect to launch tender offer for shares of G Steel and G J Steel at Stock Exchange of Thailand, under theobligation of security law in Thailand.

(1)

Expected Offer price

G Steel shares:0.0081 USD per common share(0.27 Baht per common share*⁴)
G J Steel shares:0.0178 USD per common share(0.59 Baht per common share*⁴)(2)

Number of target securities

All securities of G Steel and G J Steel (no maximum or minimum limit)*4: Reference value based on the Weighted-average Interbank Exchange Rate as of January 18, 2022, announced byCentral Bank of Thailand.
7. Future Outlook
The change of subsidiaries will have no impact to the earnings results for this fiscal year.
(Reference) Consolidated Earnings for this Fiscal Year (released on November 2, 2021) and Actual Consolidated
Earnings Results for First 6 Months of this Fiscal second quarter
Consolidated
revenue

Consolidated
business profit

Profit (loss)
attributable toowners of parents

Consolidated
operation profit

Consolidated Earnings
Forecasts for this Fiscalyear(Fiscal Year Ending March
31, 2022)

6,700

800-520

Actual Consolidated
Earnings Results for thelast Fiscal Year
(Fiscal Year Ending March
31, 2021)

4,829

11011(32)(Billion yen)
Note : This document has been translated from the Japanese original for reference purposes only. In the event of any
discrepancy between this translated document and the Japanese original, the original shall prevail.