Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Companies / News/  Thyssenkrupp could halve stake in Tata Steel JV in the event of an IPO
BackBack

Thyssenkrupp could halve stake in Tata Steel JV in the event of an IPO

Thyssenkrupp could halve its stake in a planned European steel joint venture with Tata Steel if the owners decide to on an IPO by end-2024

Initially, Thyssenkrupp and Tata Steel will each own 50% of the venture and have committed to hold equal shares in the entity for the first six years. Photo: BloombergPremium
Initially, Thyssenkrupp and Tata Steel will each own 50% of the venture and have committed to hold equal shares in the entity for the first six years. Photo: Bloomberg

Frankfurt: Thyssenkrupp AG could halve its stake in a planned European steel joint venture with Tata Steel Ltd if they go for an initial public offering (IPO) by end-2024, a board member of the German industrial group said on Friday.

The two have committed to holding equal stakes for the first six years of the company’s existence, Thyssenkrupp personnel chief Oliver Burkhard told journalists on a call. In case of an IPO, they are to retain at least a 50.1% stake, he said, meaning Thyssenkrupp could reduce its stake to 25.05%.

Thyssenkrupp a day earlier reached a deal with steel workers to secure jobs and plants, a key condition for the joint venture, which will create Europe’s second-largest steelmaker, to go ahead next year.

Shares in Thyssenkrupp were down 0.9% at 1309 GMT, leading decliners in a flat German market.

Traders and analysts said unions had been able to extract far-reaching commitments from management. “The likelihood of the joint venture’s creation has increased, which we welcome," said Sven Diermeier, senior analyst at Independent Research. “However, the flexibility of the entity and Thyssenkrupp is constrained by the agreement."

The agreement with unions foresees no forced layoffs or major site closures before September 2026, labour representatives and the company said.

It still requires approval from the members of IG Metall, Germany’s most powerful union, which will cast their votes between 13 January and 2 February.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Corporate news and Updates on Live Mint. Download The Mint News App to get Daily Market Updates & Live Business News.
More Less
Published: 22 Dec 2017, 05:23 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App