Thyssenkrupp must quickly present strategy, steel solution - Deka

Thyssenkrupp must quickly present strategy, steel solution - Deka

Reuters  | Jul 28, 2020 15:40

Thyssenkrupp must quickly present strategy, steel solution - Deka

By Christoph Steitz

FRANKFURT (Reuters) - Conglomerate Thyssenkrupp (DE:TKAG) must soon find a solution for its struggling steel unit and say how it will spend the 17.2 billion euros (15.6 billion pounds) in proceeds from the sale of its elevator division, a top-20 investor said.

"There has to be a solution for steel in the near term. It would be good if there was clarity until the next annual general meeting," said Ingo Speich, head of sustainability and corporate governance at Deka Investment, Thyssenkrupp's 11th-largest shareholder, who has been an outspoken critic of Thyssenkrupp's performance in the past.

Speich's remarks come ahead of the deal's closing, which sources say is expected on Friday.

Thyssenkrupp's next AGM is scheduled for Feb. 5, 2021.

The group has said it might sell, keep or merge its steel division with a peer, with Salzgitter (DE:SZGG), Tata Steel (NS:TISC), SSAB and Baoshan Iron & Steel (SS:600019) all considered potential partners, sources have said.

"Completely divesting steel will be difficult," Speich said, adding a joint venture or merger with a peer would be the most likely options.

"Time is against Thyssenkrupp and in favour of its peers," Speich said.

The sale of elevators to a consortium of Advent, Cinven and Germany's RAG foundation will effectively hand Thyssenkrupp a financial lifeline to turn around its other business units, which range from car parts to submarines.

But the group has signalled that most of the proceeds will be used up by cutting down debt, paying off pension liabilities and for offsetting business lost thanks to the coronavirus pandemic, leaving little to fund future projects.

One of the people said that less than 2 billion euros might be available to invest in growth.

Thyssenkrupp's shareholders are not expected to get a share either, Speich said: "The company needs every cent."

Thyssenkrupp declined to comment.

© Reuters. FILE PHOTO: ThyssenKrupp steel factory in Duisburg

Related News

Latest comments

Add a Comment
Please wait a minute before you try to comment again.
Discussion
Write a reply...
Please wait a minute before you try to comment again.

Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.

English (USA) English (India) English (Canada) English (Australia) English (South Africa) English (Philippines) English (Nigeria) Deutsch Español (España) Español (México) Français Italiano Nederlands Português (Portugal) Polski Português (Brasil) Русский Türkçe ‏العربية‏ Ελληνικά Svenska Suomi עברית 日本語 한국어 简体中文 繁體中文 Bahasa Indonesia Bahasa Melayu ไทย Tiếng Việt हिंदी
Sign out
Are you sure you want to sign out?
NoYes
CancelYes
Saving Changes

+

Download the Investing.com App

Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.

Investing.com is better on the App!

More content, faster quotes and charts, and a smoother experience is available only on the App.

';