Thyssenkrupp may reach an agreement in principle this month to merge its European steel business with that of Tata Steel, the group said on Monday, September 11, adding talks were constructive and had entered the final stretch.
A spokeswoman for Thyssenkrupp said the companies were close to a memorandum of understanding, paving the way for a detailed look at one another’s books and detailed negotiations before creating the second-largest steelmaker in Europe.
Thyssenkrupp CEO Heinrich Hiesinger is under pressure to deliver the planned combination, particularly following Tata Steel’s deal to cut its pension liabilities, after talks have dragged on for a year and a half.
Hiesinger favors a steel joint venture, saying this is the best option to eliminate overcapacities in the volatile steel sector but drawing opposition from labor representatives, who fear thousands of job cuts.
“The management board is currently in talks over strategic options,” a spokeswoman for Thyssenkrupp said, adding a meeting of the supervisory board initially scheduled for September 12 had been moved back to ensure it was adequately informed.
Full Content: Financial Times
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