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Thyssenkrupp is in confidential talks with Jindal Steel over a possible sale of its steel business
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Discussions include valuation, obligations, and future investments in the non-binding purchase offer
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Jindal Steel may acquire 60% of Thyssenkrupp Steel Europe initially, with 40% purchased later
Germany's Thyssenkrupp on Wednesday confirmed that the company is in confidential talks with Jindal Steel International and employee representatives regarding a possible sale of Steel business.
"We are currently in confidential talks with Jindal Steel International and employee representatives regarding a possible sale of Thyssenkrupp Steel," Thyssenkrupp spokesperson told NDTV Profit.
The spokesperson added that all relevant parameters including valuation, obligations, and future investments in the non-binding, indicative purchase offer from Jindal Steel International will be addressed directly between the parties in the ongoing due diligence process and in any contract negotiations.
The potential deal is critical for Thyssenkrupp as the German conglomerate seeks to streamline operations and sharpen its focus.
Reuters, which first reported the news, said that Jindal Steel International has been conducting due diligence on Thyssenkrupp Steel Europe (TKSE) since October following an indicative bid for Europe’s second-largest steelmaker.
The same report suggests that one proposal under consideration involves Jindal acquiring an initial 60% stake in TKSE, with the remaining 40% to be purchased later. This will either in two tranches of 20% or in a single transaction, depending on the restructuring progress.
A phased approach could help Thyssenkrupp manage roughly €2.5 billion ($2.9 billion) in pension liabilities linked to TKSE. The report notes that this is a key obstacle in previous sale attempts.
The sale would conclude years of efforts to divest TKSE, a business deeply rooted in Germany’s industrial legacy but burdened by high costs and stiff Asian competition. For Jindal Steel International, part of the Naveen Jindal Group, the acquisition would represent a significant European expansion following its 2024 purchase of Czech-based Vitkovice Steel.
A Jindal delegation is expected to visit TKSE’s Duisburg plant in January for a technical assessment.
CEO Miguel Lopez recently described Jindal as an 'optimal fit' for TKSE, citing restructuring efforts that sparked the Indian firm’s interest. He added that Thyssenkrupp has a contingency plan should talks fail, though details were not provided.
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