Thyssenkrupp seals landmark steel venture with Tata Steel

 Thyssenkrupp seals landmark steel venture with Tata Steel

FRANKFURT/DUESSELDORF (Reuters) - Thyssenkrupp's supervisory board on Friday gave the green light for a steel joint venture with Tata Steel , paving the way for the European steel sector's biggest shake-up in more than a decade.

The largest transaction in Europe's steel industry since the takeover of Arcelor by Mittal in 2006, the joint venture - to be named Thyssenkrupp Tata Steel - will have about 48,000 workers and 15 billion euros ($17.5 billion) in combined sales.

Based in the Netherlands, it will be the continent's No.2 steelmaker after ArcelorMittal and forms the core of Thyssenkrupp CEO Heinrich Hiesinger's plan to turn the steel-to-submarines conglomerate into a technology company.

"The joint venture with Tata Steel is an important milestone for the transformation of Thyssenkrupp to an industrials and service group and will lead to a significant improvement of the financial figures of Thyssenkrupp, effective with closing," the group said in a statement.

The deal comes as European steel makers face stiff tariffs of 25 percent on their exports to the United States, their biggest market, fuelling fears the local market might be forced to absorb more volumes as a result.

Since tariffs were announced in late May, shares in European steelmakers ArcelorMittal, Thyssenkrupp, Salzgitter and Voestalpine have lost between 8-17 percent.

($1 = 0.8588 euros)

(Reporting by Christoph Steitz and Tom Kaeckenhoff; Editing by Sabine Wollrab and Douglas Busvine)

This story has not been edited by Firstpost staff and is generated by auto-feed.

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Updated Date: Jun 30, 2018 03:05:21 IST