Tata Steel and thyssenkrupp have both reported that they expect that the planned joint venture of their European steel activities will not go ahead due to the European Commission’s continuing concerns.
Tata Steel reported that both companies viewed that further commitments or improvements to the remedy package would adversely affect the basic foundation of the proposed joint venture and the intended synergies arising from the merger to such an extent that the economic logic of the joint venture would no longer be valid and it’s the fundamental sustainability would be severely impacted. Hence both partners are unable to offer any further remedies to the Commission to meet its requirements.
Tata Steel said that while the proposed joint venture was an important strategic initiative for Tata Steel to create a sustainable portfolio in Europe that would have also helped to de-consolidate the European Business and de-leverage its Balance Sheet, it remained committed to the above strategy and would explore all options to achieve similar outcomes in the future.
Further information is available on the Thyssenkrupp and Tata Steel Europe websites.