Salzgitter to take over HKM steel joint venture
German steelmaker Salzgitter said it will be the sole owner of the Hüttenwerke Krupp Mannesmann (HKM) joint venture from 1 June 2026 after agreeing to buy out the co-owners of the company, according to a joint statement from Salzgitter and thyssenkrupp Steel.
Under the plan, thyssenkrupp Steel will sell its shares in HKM to Salzgitter, effective 1 June 2026, for an undisclosed sum, providing the latter sole responsibility in a reduced scope.
Thyssenkrupp owns 50% of HKM, while Salzgitter and Vallourec control 30% and 20% of the company, respectively.
Implementation of the plan is subject to the approval of Salzgitter’s governing bodies and a positive assessment of a going concern report, which Salzgitter has already commissioned. The agreement is also conditional on the third owner, Vallourec, also agreeing to sell its shares to Salzgitter.
HKM will continue to supply slab to thyssenkrupp Steel until the end of 2028, instead of previously planned 2032.
Thyssenkrupp closed its heavy plate mill, which used HKM’s slabs as feedstock, in 2021. In addition, under the restructuring proposal, thyssenkrupp planned to cut production from 11.5 mt/y to 8.7-9.0 mt/y and to separate from HKM – either by selling the asset or shutting the plant if no buyer was found.
“This agreement is an important milestone and brings us a good step closer to establishing a sound industrial future for HKM. It creates clarity for everyone involved in this process, while offering HKM’s workforce a positive perspective. HKM will thus become part of the process of transforming to low-CO2 steel production in the Salzgitter Group,” Gunnar Groebler, CEO Salzgitter, said.
To learn more about decarbonisation projects in Europe and globally – check Global Green Steel Profile.
HKM has a capacity of around 6 mt/y of crude steel, with semi-finished products manufactured via the blast furnace-basic oxygen furnace (BF-BOF) route.
Salzgitter’s announcement confirmed rumours that one of HKM’s shareholders was planning to continue production despite earlier plans to divest the asset as the mill can supply slab to the spot market to substitute imports.
European re-rollers, mainly producing heavy plate, rely heavily on imported slab, though the introduction of the Carbon Border Adjustment Mechanism (CBAM) on steel imports to the EU from January 2026 has resulted in a significant increase in costs. European re-rollers estimated CBAM duties for import slab at EUR40-80/t, but those numbers could be higher if the exporting steelmaker does not get emissions verification in time in which case the buyers would have to pay the duty based on default emission values.
A few market sources have reported revived domestic slab market activity in Europe with HKM offering slab on the spot market.
Thyssenkrupp to install line for medium-wide strip
Thyssenkrupp Steel is planning to convert a continuous casting line at its Duisburg-Nord site amid changes to its offtake supplies for medium-wide strip steel.
A divider is to be installed, which will make it possible to cast the required narrow slabs, it explains. The necessary investment funds in the high double-digit million range have already been approved.
The steelmaker recently announced it will terminate the offtake of supplies from HKM after 2032.
The steelmaker has sourced narrow slabs produced by Duisburg mill HKM (Hüttenwerke Krupp-Mannesmann) to roll them at its Hohenlimburg site to medium-wide strip of 600mm width, used by automotive and other industrial customers.
According to a seasoned industry observer, medium-wide strip in the past used to be produced by various EU steelmakers. This has been widely replaced by normal-width strip, which is then slit into narrower strip.
“Making medium-wide strip with dedicated technology takes more effort, but it has advantages,” he tells Kallanish. For example, higher pressure can be exerted to roll harder steels with a higher carbon content, he says.
A spokeswoman at tk Steel concurs and notes that the final products are often small in terms of tonnage, but with tight tolerances when it comes to small precision parts, like blades, or certain parts used in cars.
Thyssenkrupp Steel is the only European steelmaker left to produce medium-wide strip on bespoke facilities, she says.
Christian Koehl Germany
Thyssenkrupp breaks economic link with Hüttenwerke-Krupp Mannesmann
Thyssenkrupp Steel Europe, subsidiary of German steelmaker Thyssenkrupp Steel, is breaking its economic link with Hüttenwerke-Krupp Mannesmann (HKM), the joint venture between Thyssenkrupp Steel, German steelmaker Salzgitter and French pipe manufacturer Vallourec.
The company has announced that it has decided to terminate the supply contract with HKM. As a result, Thyssenkrupp Steel Europe’s obligation to purchase around 2.5 million mt of steel per year will expire on December 31, 2032, at the latest.
Last year, Thyssenkrupp Steel had declared that it intended to divest its stake in HKM as part of its restructuring plan, while the negotiations with Hamburg-based CE Capital Partners on the sale of Thyssenkrupp shares in HKM failed, as SteelOrbis previously reported.
“Due to market conditions, we will have to reduce our production capacities in the long term from the current 11.5 million mt of steel to a shipping target of 8.7 to 9 million mt. The separation from HKM is therefore imperative for us in order to achieve a competitive cost position, to maintain our location in Duisburg-Nord, and to make Thyssenkrupp Steel economically robust and geared up for the future. Irrespective of the termination of the supply contract, the sale of the shares in HKM remains our preferred option. We are open to discussions with all serious interested parties,” Dennis Grimm, spokesman of the executive board of Thyssenkrupp Steel, said.
Thyssenkrupp to axe 11.000 jobs, reduce capacity
Thyssenkrupp Steel says it will cut around 5,000 jobs in production and administration by 2030. A further tranche of 6,000 jobs is to be transferred to external service providers or shed through the sale of business activities.
The steelmaker will lower annual production to 8.7-9 million tonnes, from 11.5mt currently. The reduced volume corresponds to shipments in the previous financial year.
Such a reduction is “in line with market conditions, thus adapting capacities to future market expectations,” it says in a press release sent to Kallanish. The figures are the cornerstones of a key issues paper on the company’s future strategic set up, which was announced previously.
Tk Steel’s separation from Hüttenwerke Krupp Mannesmann (HKM) remains a key element in the capacity reduction. The primary objective is to sell the shares in HKM. If a sale is not possible, tk Steel will hold talks with the other shareholders about mutually acceptable scenarios for the plant’s closure – the first time this option has been explicitly mentioned.
In addition, a processing site in Kreuztal-Eichen is to be closed.
“Comprehensive optimisation and streamlining of our production network and processes is necessary to make us fit for the future. We are aware that this path will demand a great deal from many people,” says tk Steel chief executive Dennis Grimm.
“In terms of operational efficiency and profitability, we still have some catching up to do in key competitive areas. We need to close these gaps if we want to look forward to a positive future,” adds Marie Jaroni, chief transformation officer.
The company maintains that it remains committed to the green transformation and carbon-neutral steel production, and is holding firmly to its intended plan of completing the direct reduction plant that is under construction. A decision on building another DRI plant will only be taken at a later date and under the economic, technological, and political conditions that apply at that time, tk Steel says.