Thyssenkrupp JV: Kretinsky makes way for Jindal Steel

FRANKFURT: German industrial giant Thyssenkrupp and Czech tycoon Daniel Kretinsky said Thursday they had abandoned plans for a joint steel business, paving the way for a potential takeover by Jindal Steel.

"The EP Group and Thyssenkrupp AG have mutually agreed to end talks about a possible 50/50 joint venture for Thyssenkrupp Steel Europe," they said in a joint statement referring to Kretinsky's holding company.

The EP Group would return its 20 percent stake in Thyssenkrupp Steel Europe (TKSE) to Thyssenkrupp, the statement added, and Thyssenkrupp would reimburse the purchase price to the EP Group.


Kretinsky's divestment removes a possible obstacle to Jindal Steel taking over Thyssenkrupp Steel Europe, part of the broader Thyssenkrupp group.

Jindal in September made a non-binding offer for TKSE, setting up a potential battle with Kretinsky for control of Germany's largest steelmaker.

Thyssenkrupp said at the time that it would "carefully review" Jindal's offer and pay "particular attention" to what it would mean for jobs.

In Thursday's joint statement, the EP Group said it "respects Thyssenkrupp AG's preference to concentrate on discussions with Jindal Steel International".

A sprawling conglomerate -- with businesses ranging from auto parts to submarine-making -- Thyssenkrupp wants to get rid of its steel unit which is struggling in the face of cheaper Asian competition.

TKSE last November said it would cut 11,000 jobs by 2030 and production capacity to about 9 million tons a year from 11.5 million tons.