Thyssenkrupp spokesmen dismissed as “rumors” Friday a magazine report that the German steelmaker had approached metals distributor Kloeckner & Co. about a possible takeover or link-up just a month after Thyssenkrupp’s bid to merge with Tata Steel Europe fell through.
German business publication Manager Magazin reported Thursday that Thyssenkrupp was eyeing a takeover of Kloeckner, a move that would boost its Thyssenkrupp Materials Services unit.
Thyssenkrupp spokesmen said they could not confirm the existence of talks on this specific subject between CEO Guido Kerkhoff and Kloeckner CEO Gisbert Ruehl. However, one spokesman noted that Kerkhoff and Ruehl regularly meet and talk “as Kloeckner is just round the corner from us in Duisburg. The rumors have been going on for at least two years.”
According to the magazine report, Thyssenkrupp aims to use the proceeds from the planned IPO of its elevator business to fund the acquisition.
One Thyssenkrupp spokesman noted that Kerkoff recently stated the company wishes to carry out the IPO “to restructure the company.” After the European Commission blocked merger plans between Thyssenkrupp and Tata on grounds that the companies were not prepared to offer sufficient concessions to ensure healthy competition in the marketplace, Kerkhoff said that the group may be looking for other steel partnerships to move its business forward.
Kloeckner had no immediate comment on the report when contacted Friday by S&P Global Platts. The company has previously been reported as saying that it would be interested in linking up with Thyssenkrupp’s Materials Services’ steel stockholding and trading businesses.
Last week, Thyssenkrupp announced that it has slimmed down its steel segment executive board. The former CFO of ThyssenKrupp Steel Europe, Premal Desai, has been appointed as chairman of this entity, while company steel manager Bernhard Osburg will become the board’s chief commercial officer. Former board members Andreas Goss and Heribert Fischer have left this entity.
Kerkhoff said at the time that the group’s “steel business is facing major challenges,” and that the new team needs to “develop a sustainable strategy for steel following the cancellation of the joint venture [with Tata Steel].”
— Diana Kinch