By Christoph Steitz and Tom Käckenhoff FRANKFURT/DUESSELDORF (Reuters) -Czech billionaire Daniel Kretinsky has agreed to sell his 20% stake in Thyssenkrupp’s steel unit and scrap plans for a joint venture for the business, both parties said in a joint statement, paving the way for a possible deal with Jindal Steel. The sale ends protracted talks […]
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Czech billionaire Kretinsky to sell Thyssenkrupp steel stake as JV plans falter
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By Christoph Steitz and Tom Käckenhoff
FRANKFURT/DUESSELDORF (Reuters) -Czech billionaire Daniel Kretinsky has agreed to sell his 20% stake in Thyssenkrupp’s steel unit and scrap plans for a joint venture for the business, both parties said in a joint statement, paving the way for a possible deal with Jindal Steel.
The sale ends protracted talks over what could have become a German-Czech steel and energy giant, discussions that have not made any measurable progress since Kretinsky bought a fifth of Thyssenkrupp Steel Europe (TKSE) last year.
Kretinsky has already given up his seat on TKSE’s supervisory board, along with another senior executive of his EP Group, a company spokesperson said.
Shares in Thyssenkrupp rose as much as 3% to hit their highest level in nearly six years before trading 0.7% lower at 1208 GMT.
CLEAR PATH FOR TALKS WITH JINDAL STEEL
It now creates momentum for Thyssenkrupp to intensify talks with India’s Jindal Steel International, which last month submitted an indicative bid for all of TKSE, a volatile business its parent has sought to divest.
The statement said that Kretinsky’s EP Group “respects Thyssenkrupp AG’s preference to concentrate on discussions with Jindal Steel International” and that it would be reimbursed for the purchase price it paid to Thyssenkrupp for the TKSE stake.
While both parties have never disclosed the purchase price, people familiar with the matter have put it at around 140 million euros ($164 million).
The news comes amid growing uncertainty over the future of steelmaking in Europe, as the sector contends with cheap Chinese imports, high energy costs and delays to hydrogen-based decarbonisation in one of the most polluting industries.
Kretinsky’s EP Group and Thyssenkrupp had the aim of eventually forming a 50/50 joint venture for TKSE, but talks have been fraught with difficulties as powerful unions have accused the Czech businessman of refusing to engage.
“The management board can and must concentrate fully on the talks with Jindal,” said Juergen Kerner, Thyssenkrupp’s deputy supervisory board chairman and a senior member at IG Metall, Germany’s biggest trade union.
“In particular, details on financing must now be clarified quickly, but above all thoroughly. The employee side expects to be involved at an early stage.”
($1 = 0.8511 euros)
(Reporting by Christoph Steitz and Tom Kaeckenhoff; Additional reporting by Markus Wacket; Editing by Matthias Williams and Louise Heavens)