Date
28 May 2017
Tata Steel has decided to include a sizable chunk of its British business in any sale process. Photo: Internet
Tata Steel has decided to include a sizable chunk of its British business in any sale process. Photo: Internet

Germany’s ThyssenKrupp confirms tie-up talks with Tata Steel

Germany’s ThyssenKrupp AG is in talks with Tata Steel Ltd. of India and other parties on a potential tie-up.

The move signals a new wave of expected consolidation in the beleaguered European steel sector, the Wall Street Journal reports.

It comes amid a flurry of mergers and acquisitions by European steel makers to cope with a protracted capacity glut and a wave of inexpensive steel imports from countries such as China, the world’s largest steel producing nation.

“We have repeatedly emphasized that in this situation we believe a consolidation of the European steel industry is necessary,” a spokeswoman for ThyssenKrupp said.

“Among others, we are also in talks with Tata Steel.” 

The spokeswoman cautioned that it was still unclear “when and with whom” such a merger could transpire.

Tata Steel said last week that it was in talks with ThyssenKrupp about creating a European flat-steel-products joint venture, prompting the German company’s confirmation on Monday.

In April, The Wall Street Journal reported that the two companies had been holding high-level talks for more than a year about combining their European steel operations.

At that time, Tata Steel had only planned to combine its Dutch assets with ThyssenKrupp’s steel assets​in Germany while hiving off its ailing UK business to other parties.

Tata Steel, however, changed tack last week and said it would now include a sizable part of its UK business in the sale process as well.

This includes a series of plants dotted throughout Britain that employ 9,000 people, including Britain’s biggest plant, in Port Talbot, Wales. ​

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