EC extends deadline for TK/Tata Steel Europe merger

The European Commission has extended the deadline for the Thyssenkrupp and Tata Steel Europe merger by four days to March 23, 2019, according to a note on the EC’s website.

The EC opened a detailed antitrust review on October 30 following a preliminary review with an initial deadline of March 19.

“At this stage, the Commission is concerned that, following the transaction, customers would face a reduced choice in suppliers, as well as higher prices. These customers include various European companies, ranging from major corporations to numerous small and medium-size enterprises,” the EC said.

The issues regard primarily flat carbon steel for automotive applications, metallic coated steel for packaging, and grain-oriented electrical steel.

The EC invited interested third parties to submit their opinions on the merger last week.

TK and Tata notified the EC on September 25 of the transaction, but did not submit commitments during the initial investigation to address concerns.

If the merger is approved it will create Europe’s second-biggest steelmaker, behind ArcelorMittal, producing 21 million mt/year.

TK will receive a greater share of the proceeds in the event of an initial public offering, at a ratio of 55:45. Moreover, TK has the right to decide on the timing of any IPO.

The headquarters will be in the Amsterdam area and there will be a two-tier structure consisting of a supervisory board and a management board with three members from each company.

Laura Varriale