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European giants ThyssenKrupp and Tata Steel seek merger
May 20,2020 10:16CST
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SMM5 March 20: Tata Steel Europe company (TataSteelEurope) has resumed negotiations with Germany's ThyssenKrupp (Thyssenkrupp) to seek a possible merger. Earlier, the two companies cancelled a joint venture proposal, citing opposition from the European Commission.

Both Tata Steel and ThyssenKrupp are facing tough financial conditions and will take steps to sell some of their assets to meet European anti-competition rules, according to investment bankers.

Global steel prices have fallen 11 per cent in the past year, triggering a financial crisis in the industry. Steel prices have plummeted since June 2019, and financial indicators for both companies have deteriorated. Tata Steel Europe is cutting jobs and seeking a £500m bailout from the UK government to operate in the UK. As a result, they have reason to restructure their operations. ThyssenKrupp is reportedly in talks with Tata Steel Europe, a large Chinese steelmaker and Sweden's SSAB to merge or sell its business.

ThyssenKrupp is the second largest flat steel producer in Europe, while Tata Steel is the third largest flat steel producer. Both companies are important producers of galvanized flat steel for the automotive industry.

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