Thyssenkrupp completes negotiations with Liberty to sell its steel division

Germany's Thyssenkrupp said on February 17 that the company had completed negotiations to sell its steel division to Liberty Steel, focusing on its own restructuring.

Thyssenkrupp said the decision came after a failure to reach an agreement with Liberty.

“We opened the door to negotiation, but in the end our understanding of corporate value and deal structure was very different,” CEO Klaus Keisberg said in a statement.

In a press release, Thyssenkrupp said it will now continue to promote a "strong position" for steel on its own.

Liberty Steel presented Thyssenkrupp with an updated and optional offer to acquire Thyssenkrupp Steel Europe earlier this year, and Keisberg said in a press conference last week that Liberty was the only selling partner in question. However, Keisberg then stressed that a "stand-alone" steelmaking solution was still under discussion when Thyssenkrupp would spin off from the division.

This was the second attempt at a merger for Thyssenkrupp's steel division after the failure of merger talks with Tata Steel Europe in 2019. Meanwhile, Tata Steel Europe has also made a second attempt to merge its steel business, but potential partner Swedish steelmaker SSAB canceled negotiations earlier this year.

News of the failure of the Thyssenkrupp-Liberty talks is likely to further dampen market speculation as to whether the European steel industry will see other constellations or possible mergers. Market sources said SSAB may be a better fit for Thyssenkrupp than Liberty in terms of consumer markets and products.

Thyssenkrupp's steel division began to profit again at the end of 2020 following a rapid rise in flat steel prices. Platts HRC's daily estimate remains at a 13-year high, rising more than € 330 per tonne since summer 2020. The estimate was € 730 per tonne EXW Ruhr on 17 February.