FRANKFURT (Reuters) - Weakening steel markets are complicating Thyssenkrupp (ETR:TKAG)'s talks over the potential sale of a stake in its Steel Europe business to Czech billionaire Daniel Kretinsky, the German conglomerate's CEO said in prepared remarks.
Europe's steel industry is suffering from falling demand at home, a stuttering Chinese economy, and Asian rivals flooding the local market with cheaper products.
Meantime, talks with Kretinsky and his energy holding EPH over a potential joint venture that would give the Czech billionaire up to 50% of Thyssenkrupp's steel business have been going on for months.
Sources familiar with the matter told Reuters last month that Thyssenkrupp may need to hand over cash or keep hold of some pension liabilities to win over Kretinsky.
"The economic challenges in the steel industry are not making the talks any easier," Chief Executive Miguel Lopez said in the text of his speech to be given at the group's annual general meeting on Feb. 2.
He said the company remained in "constructive and open-ended talks" with EPH, adding Thyssenkrupp was exploring partnerships worldwide to secure green and affordable energy for its steelmaking activities and that it was in discussions with strategic partners on that.
"For example, we see great potential on the Iberian Peninsula, in the Middle East, but also in the south of the USA," Lopez said.