Tata Steel, ThyssenKrupp sign deal to form Europe's second-largest steelmaker

First stage of Tata’s merger with German steel maker Thyssen Krupp ‘agreed

The steel giants signed a memorandum of understanding today (20 September) on a planned combination of the flat steel businesses of the two companies and the steel mill services of Thyssenkrupp.

German Labour Minister Andrea Nahles said on Wednesday that a merger between Germany's Thyssenkrupp and Tata Steel should not happen at any cost and the headquarters needed to be in Germany if it did happen.

The joint venture would have a pro forma turnover of about €15 billion per annum (Rs115,000 crore) and now employs about 48,000 people spread across various locations.

"The Tata Group and Thyssenkrupp have a strong heritage in the global steel industry and share similar culture and values".

The agreement will now be followed by negotiations and due diligence by both the companies and they expect to close the deal as early as the beginning of 2018.

The MoU, widely expected after Thyssenkrupp last week said a deal could be reached this month, outlines annual synergies of 400-600 million euros ($480-720 million) as well as up to 4,000 job cuts, about 8 percent of the joint workforce.

Slaughters is advising longstanding client Tata Steel on the deal, with a team led by M&A partners Robin Ogle and Padraig Cronin, and finance partner Andrew McClean. We are tackling the structural challenges of the European steel industry and creating a strong No. 2. "Beyond a clear performance orientation, we also share the same philosophy of corporate responsibility towards employees and society", added Heinrich Hiesinger, chairman of Thyssenkrupp's executive board.




There is undoubtedly an industrial logic behind a partnership which would create the second biggest steel business in Europe with all the benefits that could bring for the UK.

Currently, shares in Tata Steel are up 1.63 percent, whilst shares in Thyssenkrupp are up 3.62 percent as of 12.10PM (GMT). Under the agreement, both the companies will have 50% stake in the newly formed entity.

"The government has been working hard with the unions to secure a sustainable future for Tata Steel in the United Kingdom, its 4,000 employees at the Port Talbot site and its supply chain".

The British government and unions said they welcomed the merger so long as commitments made by Tata Steel UK to safeguard jobs and extend blast furnace operations at Britain's largest steelworks in Port Talbot, Wales, were maintained.

The deal could have sweeping implications for the industry and for 8,000 workers employed in the United Kingdom in particular.

Any deal is still subject to approval by Thyssenkrupp's supervisory board and Tata Steel's board of directors as well as that of the European Commission.

Related news:

Hot News

isis-killer-beheading-video-story-top Hackers Have Successfully Hidden Malware In Popular PC Cleanup Tool
Sep 20, 2017 - 00:55
The infected version of the software was released on August 15 , meaning that millions of users are potentially at risk. CCleaner is available as free or paid for subscription and both versions are said to have been affected by the breach.

isis-killer-beheading-video-story-top Trump Wants A Grand Military Parade For The Fourth Of July
Sep 20, 2017 - 00:55
This would not be the first military parade the USA has held, but there has not been one in D.C.in decades - not since 1991. Trump had previously expressed an interest in including military vehicles in his inaugural parade.

isis-killer-beheading-video-story-top No Looking Back on Deporting Rohingyas: Indian Government Tells Apex Court
Sep 19, 2017 - 01:02
As the Myanmar government does not recognise the Rohingyas as its citizens, in general, it will be hard for India to deport them. It is submitted that this obligation is binding only in respect of the States which are parties to the Convention.

isis-killer-beheading-video-story-top Benitez shuns table as Newcastle enjoy lofty perch
Sep 19, 2017 - 01:00
Jamaal Lascelles claims that Newcastle United's "inexperience is a strength", as the side is full of energy with a will to win games.

isis-killer-beheading-video-story-top Clemson moves up to No. 2 behind Alabama
Sep 19, 2017 - 00:58
Vanderbilt , which beat a ranked K-State team on Saturday night, is not ranked despite having three wins. The top 5 in both polls is the same, starting with Alabama , Clemson , Oklahoma, Penn State and USC.

isis-killer-beheading-video-story-top J&K: 3 civilians injured in ceasefire violation by Pakistani forces
Sep 18, 2017 - 00:30
Panic has gripped scores of border residents living in villages close to the worldwide border of R.S. This is the fifth ceasefire violation by Pakistan in six days, according to PTI.

isis-killer-beheading-video-story-top What Time Does the Canelo-Golovkin Fight Start?
Sep 17, 2017 - 00:42
While tenaciously walking down opponents, Golovkin also demonstrates great technical skills and punching accuracy. Alvarez's only defeat came in 2013 against Floyd Mayweather , who was too fast and smart for him.

isis-killer-beheading-video-story-top Kaspersky Lab rejects claims of Russian influence
Sep 16, 2017 - 01:07
Jeanne Shaheen of New Hampshire has push legislation that would ban the company's products governmentwide. Kaspersky products will now be withdrawn from stores and the firm's website.

isis-killer-beheading-video-story-top Soon Xbox games might not require full downloads to play
Sep 16, 2017 - 01:06
It'll be fun to see what devs can do with this feature in a year or two's time. Let us know what you think about the Xbox One X intelligent delivery system.

isis-killer-beheading-video-story-top Arsenal's Europa League Group Preview
Sep 16, 2017 - 01:02
Outspoken Arsenal fan Morgan claimed that Wilshere should in fact be starting ahead of Wales global Aaron Ramsey in the Gunners team.

isis-killer-beheading-video-story-top Cardinals RB David Johnson to undergo wrist surgery
Sep 15, 2017 - 00:41
Coach Bill O'Brien benched Tom Savage for rookie Deshaun Watson at halftime of Houston's 29-7 loss to the Jaguars on Sunday. He was placed on injured reserve on September 2 because of an undisclosed injury, and then released two days later.

isis-killer-beheading-video-story-top Trump on taxes, wants lower corporate tax rate
Sep 15, 2017 - 00:40
Manchin, Heitkamp and Donnelly are the only Democratic senators who did not sign a letter addressed to Republican leaders and Trump.

isis-killer-beheading-video-story-top Who's better: Kohli or Smith? Michael Clarke has his say
Sep 15, 2017 - 00:39
After making the final of the Champions Trophy, they recorded series wins in the West Indies and Sri Lanka . The journalist may have been referring to the match being played between Pakistan and the World XI team.

isis-killer-beheading-video-story-top Vince McMahon Apparently Refused Medical Attention After His Beatdown Last Night
Sep 14, 2017 - 01:14
As good as a heel Owens has become, Hogan thinks he could be a great good guy. During a segment with Kevin Owens, The Chairman Of The Board got demolished.

isis-killer-beheading-video-story-top Pippa Middleton comforts Duchess Catherine through morning sickness
Sep 14, 2017 - 01:10
In other news concerning the English royal family, Prince George is scheduled to begin school at Thomas's Battersea on Thursday. Kate is being cared for at the royal couple's apartment in London's Kensington Palace .