Bloomberg reported that Nippon Steel Corp and Sumitomo Metal Industries plan to choose a single partner in India to avoid project duplication, as they prepare to combine to create the world’s second largest steelmaker.

Mr Shinichi Taniguchi EVP of Nippon Steel said in an interview that “We cannot compete in the same countries or same regions within the new company.”

Mr Taniguchi said that the two companies will hold talks on overseas partners as soon as they sign a contract in April next year. He said “We will examine how much compensation will need to be paid to each partner if a contract is called off.”

Mr Taniguchi said that Nippon Steel and Sumitomo Metal have yet to hold talks because they are still unable to study each other’s contracts with overseas partners.

Nippon Steel is building a plant with TATA Steel while Sumitomo Metal is in construction talks with Bhushan Steel.

(Sourced from Bloomberg)