Berlin expected to decide on Thyssenkrupp defence division stake in autumn
Reuters
Published Sep 08, 2023 15:57
By Christoph Steitz and Tom Käckenhoff
FRANKFURT/DUESSELDORF (Reuters) - Berlin is expected to decide within weeks whether to take a stake in Thyssenkrupp (ETR:TKAG)'s warship division, which the conglomerate is seeking to divest, a leading labour official said on Friday, adding this was a precondition for any sale.
Daniel Friedrich of Germany's biggest union IG Metall, said that the issue of state participation or broader government support for Thyssenkrupp Marine Systems (TKMS) was critical in ongoing talks with potential suitors.
"There is no refusal with regard to a participation of the state," Friedrich, who leads the division at IG Metall that represents workers in coastal areas, said with regard to TKMS, which builds submarines and frigates.
"It has been understood that the state must position itself differently than in the past," he said, hinting at Berlin's hesitance in the past to play a role in the sector's consolidation which companies have long said is necessary.
The Economy Ministry had no immediate comment.
Thyssenkrupp is looking for a standalone future for TKMS and has mentioned a listing, partial sale or merger as possibilities to reach its goal.
Labour support is vital to any major transaction at Thyssenkrupp, where IG Metall has traditionally wielded substantial influence. The union has called on Berlin to take a 25.1% blocking minority stake in TKMS.
An additional sticking point in talks are so-called sureties that TKMS has to provide to customers to safeguard orders and prepayments, according to two people familiar with the matter, with one saying these stood at more than 10 billion euros ($10.7 billion).
"I am counting on the ministries involved and the Chancellor's Office to provide clarity in the next few weeks. There should be movement before the end of autumn," Friedrich said.
Thyssenkrupp remains in talks with a small group of potential suitors, including private equity player Carlyle about selling a stake in TKMS, according to people familiar with the matter.
Thyssenkrupp and Carlyle declined to comment.
In July, the CEO of Italian rival Fincantieri said the group was open to talks with Thyssenkrupp about potential deals with regard to TKMS, adding any cooperation between the two companies would create new value.
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Written By: Reuters
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