Talks between Thyssenkrupp and Jindal Steel International over the potential sale of Thyssenkrupp’s steel division are facing significant hurdles, with sources indicating the deal could be called off in the coming weeks.
Negotiations, which have been ongoing for nearly six months, have reportedly hit roadblocks over key issues including pension liabilities, future investment commitments, and rising energy costs in Europe. While discussions continue, the likelihood of a final agreement has diminished considerably.
A major sticking point remains the steel unit’s estimated €2.4 billion pension liabilities, which have historically complicated previous attempts to divest the business. In addition, both parties are said to have differing views on the scale of future investments required to modernise operations and transition toward greener steel production.
Another critical concern is the sharp increase in energy costs across Europe, which has raised doubts for potential investors. With energy prices already higher than in the US and Asia, recent geopolitical developments have further intensified cost pressures, making long-term viability more uncertain.
The possible collapse of the deal would be a setback for Thyssenkrupp’s broader restructuring strategy under CEO Miguel López, which aims to transform the group into a holding company by divesting stakes in its various business units.
Despite the challenges, both companies have maintained that confidential discussions are ongoing, with key issues around valuation, obligations, and future investments yet to be fully resolved. A final decision on the deal could emerge as early as next month.
Source: ET (Business Unlimited takes no editorial responsibility for the same.)
