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The Germans Thyssenkrupp and Tata Steel finally agreed on Saturday to establish a long-running joint venture, which would create the largest European steel company after ArcelorMittal.
The agreement constituted a "strong response to the challenges of the steel market" and would create an additional value of 5 billion euros for both companies, said the two steelmakers in a statement Common
. The announcement comes after Thyssenkrupp's supervisory board agreed on Friday night, after the German group secured a number of concessions to reflect a "valuation gap" that had developed between the two companies. two entities.
The company set up by the 50/50 joint venture – which will be called Thyssenkrupp Tata Steel – would be run by a Dutch-based holding company, employ about 48,000 workers and have an estimated turnover. to 17 billion euros. Synergies are expected to be in the range of 400 to 500 million euros
The agreement provided for an "appropriate compensation" for the value difference – a number of. Thyssenkrupp's activist investors, including Elliott, had pushed these last few weeks terms – including agreeing that in the case of an IPO, Thyssenkrupp would receive a higher share of the product, reflecting a ratio of 55: 45 in favor of Thyssenkrupp. Thyssenkrupp would also have the right to "exclusively decide" the timing of an IPO.
"Robust and competitive"
"The joint venture will create a solid, structurally sound and competitive pan-European steel company" Natarajan Chandrasekaran, chairman of Tata Steel, said in the statement. "This is an important step for Tata Steel and we remain fully committed to the long-term interest of the joint venture."
The company comes at a time when the European steel industry is under new pressure following the introduction of 25% duties. US steel imports on June 1st are not limited to hitting European companies in the lucrative and high value-added market of the United States, but the tariff regime is expected to result in a drop of steel on the European market. Cost producing countries such as China are struggling to find a market for supplies.
EU examines guarantees
The EU is investigating whether its anti-dumping safeguards regime is adequate, although a number of other industries such Automotive and construction sectors have resisted harsh measures, arguing that this would not be in the interest of European consumers.
"With the joint venture, we are creating a highly competitive European steel player – based on a strong industrial logic and strategic logic," said Heinrich Hiesinger, CEO of Thyssenkrupp, in his statement. Britain's Tata Steel unions welcomed the announcement, including commitments made to unions that the new company would involve significant investment across the UK. the steel industry, including the repair of one of the blast furnaces of Port Talbot. The agreement also supports a commitment to avoid compulsory layoffs until October 2026, and another that the first $ 200 million of any operating profit from the company would be reinvested in the company. # 39; company.
"This business will only succeed if the necessary strategic investments are made to enable the business to prosper," said Roy Rickhuss of the community union. "We will seek guarantees on the employment and investment of UK joint venture operations to secure the future of steel in the UK," Tony Brady said. Union Unite.
"In order for this joint venture to truly succeed and secure the longer-term future of the UK's mill and steel industry, sustained investment in the plant is required. beyond the current work on the blast furnace ". Kinnock, the deputy of Aberavon, where is the factory of Port Talbot.
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