Latest news with #ACCR
Yahoo
7 days ago
- Business
- Yahoo
Markets ask how soon Nippon Steel will benefit from $15 billion bid for U.S. Steel
(Corrects paragraph 9 description to "lower", not "outperforming") By Katya Golubkova and Anton Bridge TOKYO (Reuters) -Nippon Steel investors and analysts are asking if its $15-billion deal to buy U.S. Steel, backed but not yet approved by President Donald Trump, is positive for the near term, even if its hopes for strong U.S. demand materialise. Such a merger would create the world's third-largest steel producer by volume, after China's Baowu Steel Group and Luxembourg-based ArcelorMittal, data from the World Steel Association (WorldSteel) shows. The "planned partnership" would create at least 70,000 jobs and add $14 billion to the U.S. economy via Nippon Steel's additional investments, Trump said last week. While full details of the deal remain unclear, U.S. Steel shares surged 21% on the news and Nippon Steel gained 7%. Nippon Steel did not exclude issuing new shares to fund the takeover, Vice Chairman Takahiro Mori said in December, after having already raised some funds through hybrid financing and asset sales. "If the new equity is issued, investors will rightly be asking: is this the best possible use of capital at this moment?" said Fiona Deutsch, lead analyst with Australasian Centre for Corporate Responsibility (ACCR). The company had pledged an investment of up to $4 billion in a new coal-dependent blast furnace, said Deutsch, whose climate activist group holds less than 1% of Nippon Steel's shares. That plan, part of a wider investment commitment of $14 billion, comes "at a time when the global steel sector is shifting towards low-carbon alternatives", she added. Nippon Steel shares were up 1% by 0405 GMT, lower than the overall Nikkei index, which was up 1.6%. Unveiling the deal in late 2023, Nippon Steel offered $55 for each share of U.S. Steel, for a premium of 40% at the time. U.S. Steel shares closed at $53.3 on Wednesday. "There's a lot of immediate negative effects, even though the long-term effect may be positive," said an adviser to institutional investors on strategies for Nippon Steel. He cited the dilution as a further deterrent, besides the high offer price and additional investment commitments. Nippon Steel did not reply to a Reuters request for a comment. "In the short term, there are concerns about financing," said Shinichiro Ozaki, a senior analyst at Daiwa Securities. "Given that U.S. Steel reported a net loss for the January-March period, the stock market may worry about the limited likelihood of a short-term return on the investment." STRATEGIC GOALS Projections that domestic demand will stay weak have pushed Nippon Steel, which is Japan's largest steelmaker, and others to look to overseas expansion, while they consider shutting some blast furnaces at home. U.S. Steel is key to Nippon Steel's goal to raise its global output capacity to more than 100 million metric tons a year from 63 million tons now, as it aims to benefit from demand in India and the United States. Both markets are relatively protected from vast steel exports from China, the world's top producer, thanks to protectionist measures they have adopted, such as tariffs. In March, Nippon Steel President Tadashi Imai, who also chairs the Japan Iron and Steel Federation, warned that U.S. auto and steel tariffs could cut several million tons from Japan's annual steel output to below 80 million tons. Ownership of U.S. Steel could provide a shield for Nippon Steel from the impact of tariffs on non-U.S. operations, said Alistair Ramsay, vice president of Rystad Energy. "Should underlying demand in the United States begin and continue to recover, then we would expect the investment to pay off in good time, regardless of the duration of tariffs," he said. "But that's a big if, given how far the U.S. market has shrunk over the past few years, never mind this century." U.S. steel consumption is expected to rise by 2% this year after a drop of 1.5% in 2024, according to WorldSteel. This month, Nippon Steel said it would cut its dividend for the current fiscal year to 120 yen a share, off last year's 160 yen, and its lowest since 2021, amid a projected fall in profits, but the overall payout ratio would stay at 30%. "For the investor who cares about the share price today, you wouldn't be looking at factoring in synergies based on what you think might happen in two to three years," said the adviser, who sought anonymity as the matter is a sensitive one.
Business Mayor
20-05-2025
- Business
- Business Mayor
Shell faces shareholder pushback over gas strategy
Unlock the Editor's Digest for free Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter. A fifth of Shell's shareholders have cast doubt on its strategy to become the world's biggest supplier and trader of gas and LNG, questioning whether it makes sense from an economic or climate perspective. Wael Sawan, chief executive of the UK-listed energy major, told shareholders at the company's annual general meeting on Tuesday that 'over the coming decade, we want to be the leading integrated gas and LNG player'. He added that Shell's focus on gas would be its biggest contribution to the transition to cleaner fuels. Shell has leaned heavily into gas, forecasting a 60 per cent increase in demand for liquefied natural gas over the next 15 years, driven primarily by Asia. But a special resolution at the AGM, filed by three UK local authority pension funds and the Australasian Centre for Corporate Responsibility (ACCR), called for Shell to give more information on its LNG business and its spending on gas and asked how the goals were compatible with the company's climate goals. The resolution won 20.56 per cent support from shareholders. 'We believe that shareholders still don't have the information they need to properly assess the risks associated with this strategy,' said Sarah Brewin from ACCR at the AGM. She claimed Shell had significantly more exposure to LNG than its peers, that Asia may find cheaper alternatives to LNG, and that Shell's estimates for future demand may be affected if governments around the world introduce new emissions regulations. Andrew Mackenzie, Shell's chair, said he had not been surprised by the scale of the protest, and that it was in line with climate protest votes in previous years, which have ranged from 18 to 30 per cent of investors. 'I do not think there is a company that discloses more information on LNG than Shell,' said Sawan, at the AGM. He added that the company views gas as an essential part of the energy transition because it helps to displace coal and heavy fuel oils. 'Actually, the biggest contributions to lowering CO₂ emissions have come from gas, both here in the UK, as well as places like in the US,' he said. Sawan also argued that the increasing rollout of renewable energy will need more gas-fired power stations to back up electricity grids. 'Otherwise the power cuts that we saw in Spain can materialise again,' he said. He added that Shell was working on ways of cutting its carbon emissions and to capture and store carbon dioxide to enable it to meet its net zero targets. The size of the protest vote means the company will now have to hold a consultation with shareholders about its LNG strategy. Shell said that the level of votes on the resolution required it to 'explain what actions we intend to take to consult shareholders . . . and report back within six months'. Mackenzie said the company would provide a 'summary note' before its next AGM that 'captures the multiple disclosures' that the company will make on the subject.
The Guardian
29-04-2025
- Business
- The Guardian
Woodside commits $18bn to US project that climate advocates warn ‘would export harmful gas until the 2070s'
Australian energy company Woodside will spend $18bn on a new liquified natural gas (LNG) project in the US that one advocacy group said would add 1.6bn tonnes of greenhouse gas emissions over its 40-year life. Climate advocates said the announcement, made the week before Woodside's annual general meeting, would put further pressure on the company after a major rebuke from shareholders last year over its emissions plan. Woodside's chief executive, Meg O'Neill, said the decision to invest in the Louisiana project was a historic moment and would turn the company into a 'global LNG powerhouse'. Sign up for the Afternoon Update: Election 2025 email newsletter The project was expected to cost US$17.5bn (A$27bn), with investment company Stonepeak also investing US$5.7bn (A$8.8bn). Will van de Pol, chief executive of corporate climate advocacy group Market Forces, said Woodside had committed to a project 'that would export harmful gas until the 2070s'. Market Forces estimated the project would add 1.6bn tonnes of CO2-equivalent over its life – the equivalent of running Australia's biggest coal-fired power station, Eraring, for 120 years. For context, Australia's total annual emissions currently are 435m tonnes. Van de Pol said Woodside investors AustralianSuper and industry super fund Hesta, 'can't wash their hands of these massive new emissions committed on their watch, and they must escalate pressure by voting against directors at Woodside's AGM next week'. Alex Hillman, lead analyst at the Australasian Centre for Corporate Responsibility (ACCR) and a former climate adviser to Woodside, said: 'Investors have voiced increasing displeasure with Woodside's climate strategy, most recently with the world's only majority vote against a company's climate plan at Woodside's 2024 AGM.' ACCR sent a formal statement to Woodside to ask shareholders to vote against the re-election and election of directors at next week's AGM. Hillman said Woodside was 'doubling down on its climate strategy by proceeding with its largest-ever LNG project' and the statement would put increasing pressure on the company to listen to concerns. The bulk of climate-related emissions from Woodside's business come from 'scope 3' emissions, which mostly occur when the company's gas is sold and burned by its customers. Sign up to Afternoon Update: Election 2025 Our Australian afternoon update breaks down the key election campaign stories of the day, telling you what's happening and why it matters after newsletter promotion These indirect emissions totalled 74.65m tonnes of CO2-equivalent (co2-e) last year, according to company disclosures. The company's only plan to address these was to invest US$5bn in 'new energy products and lower-carbon services' by 2030, that would indirectly cut 5m tonnes of CO2-e each year. ACCR said Woodside's decision to go ahead with the Louisiana project would increase its annual scope 3 emissions by 27%. A Woodside spokesperson declined to comment on the increase in scope 3 emissions identified by the advocacy groups, but said the company's climate targets – including a 30% cut to direct emissions by 2030 – remained unchanged. Woodside said its US$2.35bn investment in an ammonia project was a 'material step' to its scope 3 investment goal which, when complete, would save 3.2 megatonnes of CO2-e each year. AustralianSuper said it had no comment. The Guardian also approachedHesta for comment.
Yahoo
13-03-2025
- Business
- Yahoo
Activist investor against Woodside directors' election due to climate concerns
(Reuters) -An activist investor is opposing the election of directors at an upcoming annual general meeting of Australian energy major Woodside Energy, citing poor returns and the company's failures in managing climate risks. The Australasian Centre for Corporate Responsibility (ACCR) said on Thursday that Woodside continues to follow a high-cost, high-carbon and low-value strategy that has led to its financial underperformance. Woodside's total shareholder returns over the past 15 years have been 168% lower than the ASX100 and 83% lower than the MSCI World Energy, indicating significant underperformance against both local and global markets, the activist investor said. ACCR said the firm failed to respond to investor feedback on climate risk management with 58% of shareholders voting against the Climate Transition Action Plan in 2024, marking the world's first majority vote against a company's climate plan. The activist investor recommends voting against Woodside directors Ann Pickard, the sustainability committee chair; Ben Wyatt, the current chair of the audit and risk committee; and Tony O'Neill, a sustainability committee member. Woodside is reviewing the activist group's member statement, a company spokesperson said in an emailed response to Reuters. "We consider the perspectives of all our shareholders as part of our decision-making."
Reuters
12-03-2025
- Business
- Reuters
Activist investor defies Woodside directors election citing climate risk, poor returns
March 13 (Reuters) - The Australasian Centre for Corporate Responsibility (ACCR) expressed dissent on Thursday against all directors due for election at the upcoming annual general meeting of Woodside Energy ( opens new tab, citing failures in managing climate risks, among other reasons. The ACCR filed members' statements attributed to Woodside's persistent shortcomings, including poor shareholder returns and inadequate management of climate risk. here. Woodside's total shareholder returns over the past 15 years have been 168% lower than the ASX100 and 83% lower than the MSCI World Energy, indicating significant underperformance against both local and global markets, the activist investor's statement outlined. ACCR added that the company continues to follow the same high-cost, high-carbon, low-value strategy that has led to its financial underperformance. On the issue of climate risk management, ACCR highlighted that 58% of shareholders in 2024 voted against Woodside's Climate Transition Action Plan, marking the world's first majority vote against a company's climate plan. Woodside directors, who will be voted against by ACCR in their upcoming re-election or election in 2025, are Ann Pickard, the chair of the sustainability committee, Ben Wyatt, the current chair of the audit and risk committee and Tony O'Neill, a member of the sustainability committee, ACCR said in the statement.
