Friday 11th December 2020
Entry from the table
State will not save Thyssenkrupp
Thyssenkrupp is struggling with its steel division. The area is the big problem child of the group. For a long time, the people of Essen have been toying with the state’s entry. But the company cannot meet the conditions. Now there is still a British competitor in the running – or another attempt to make it alone.
In the face of dwindling options, the industrial group Thyssenkrupp is preparing to bring its ailing steel division into shape on its own. “The topic of state participation is off the table,” said CFO Klaus Keysberg in the “Rheinische Post”. This is the result of intensive discussions with the federal government and the state of North Rhine-Westphalia. The economic stabilization fund is not the appropriate means to support the steel sector with equity. “In our case, due to the interest payments and the repayment modalities, such a participation would be associated with such high costs for the company that the additional burden would seriously jeopardize the future of the steel.” British competitor Liberty Steel is currently examining the books. The outcome is open.
“The options with other potential partners have not been sufficiently concretized at this point in time, even if there is still fundamental interest,” reported the manager. The group is not interested in getting rid of the steel. “Our aim is to make steel fit for the future.” There are different ways of doing this.
The workforce has to make concessions
The subsidiary Thyssenkrupp Steel Europe writes high losses. In contrast to the sale of the lucrative elevator division, however, there is no queue here. Heavy industry is suffering from the corona crisis, overcapacities and cheap imports from the Far East. At Thyssenkrupp, there were also home-made problems such as the billion-dollar disaster at its subsidiary Steel Americas. IG Metall had campaigned for state entry and rejects Liberty’s offer. Now the 27,000 steel cookers may have to make concessions for a renovation.
“After the Corona slump in the spring, we are currently feeling a general economic recovery,” Keysberg told the paper. From when a sustainable recovery or normalization can be expected is uncertain. “In addition, the structural challenges in the industry remain unchanged and must be addressed.”
Union does not give up entry into the state
Liberty Steel is currently examining the books in a due diligence process for a more specific assessment, Keysberg said. Thyssenkrupp will not make itself dependent on third parties. Developing the steel business in the company on its own is and will continue to be an option. “However, we see considerable potential for appreciation in our steel business even in the stand-alone scenario. And that’s why – yes – you can do it alone.”
From today’s perspective, however, further savings and restructuring measures will be necessary to get the steel sector back on track very quickly. “This will of course have to be discussed with the employee representatives.”
The union accused the management of not exploring all possibilities for state aid. “There is not only the economic stabilization fund, other solutions are possible. Why not a real participation of the state of North Rhine-Westphalia in Thyssenkrupp Steel?” Said IG Metall board member Jürgen Kerner. He referred to Lower Saxony, where the state has a stake in the steel producer Salzgitter. “We will continue to pursue a state entry with high pressure.” Kerner is Vice-Chairman of the Supervisory Board of Thyssenkrupp AG.