Going Public: Thyssenkrupp's Marine Division & CEO Lopez's Future Unveiled
Thyssenkrupp maintains its grip on Lopez and Green Steel operations.
buckle up, folks! The future's looking bumpy for Thyssenkrupp, but the CEO's sticking around and the marine division's heading for the stock market.
In a surprising turn of events, Thyssenkrupp's top-tier, Miguel Lopez, is keeping his CEO hat on, thanks to a five-year extension of his contract, which runs till 2031. Lopez steered the company two years ago and hasn't shied away from ruffling employee rep feathers during the subsequent restructuring. Jürgen Kerner, vice-president of IG Metall and deputy chairman of Thyssenkrupp's board, was one of those who voted against the contract extension.
But wait, there's more! The supervisory board is pushing ahead with Thyssenkrupp Marine Systems' (TKMS) spin-off. They're recommending an extraordinary general meeting on August 8 to approve the spin-off of a 49% minority stake. The plan is to list TKMS on the Frankfurt Stock Exchange by the end of the year.
Here's the breakdown: TKMS would be consolidated under a new holding company, with 49% of TKMS shares being transferred to Thyssenkrupp AG shareholders in proportion to their stake. This move is buoyed by a thriving demand for defense goods worldwide. TKMS boasts an order backlog of around 18 billion euros, ensuring it's busy until the next decade.
However, it's a different story in the steel business. Like ArcelorMittal and Salzgitter, Thyssenkrupp's sticking to the project for climate-friendly steel production, but it's a costly journey. A Thyssenkrupp spokesperson admits the project in Duisburg is "at the limit of economic viability."
Steeling Nerves: ArcelorMittal Abandons German "Green Steel" Plans
In other steel news, ArcelorMittal announced yesterday that it would abandon plans to convert its Bremen and Eisenhüttenstadt plants to steel production without coal. The decision was triggered by the lack of economic viability for a CO2-reduced steel production. ArcelorMittal will forfeit 1.3 billion euros in funding with this withdrawal.
German Economy Minister, Katherina Reiche, drew two conclusions from this decision. "We need lower energy prices," said the CDU politician during her visit to Washington. The German steel industry needs to become competitive again. Negotiations with China to stop "cheap steel dumping" are necessary, and we must acknowledge that transitioning to green steel is a long, expensive journey. The laws on hydrogen and its use must be tested in Germany.
Costly Transition: Thyssenkrupp Steels Ahead with Job Cuts
Thyssenkrupp Steel is already forging ahead with the new facility, eligible for around two billion euros in funding from the federal government and NRW. The climate-friendly steel production plant, slated to replace two blast furnaces by 2030, will initially be operated with natural gas and later with hydrogen.
Salzgitter is investing more than two billion euros, with a billion coming from federal and state funding. By 2033, the company aims to transition completely to green steel. Meanwhile, in Saarland, a direct reduction plant and electric arc furnaces are planned. The conversion is expected to cost around 4.6 billion euros, with the federal government and Saarland footing 2.6 billion euros.
Sources: ntv.de, jwu/rts/dpa
ThyssenKruppSteel industryMDax companyStock exchanges
### Insights:
- TKMS's IPO is planned for Q4 2025 on the Frankfurt Stock Exchange.
- Thyssenkrupp is restructuring its conglomerate structure to unlock hidden value within its individual divisions.
- The steel division aims to create more climate-friendly production systems, but the projects are costly and at the limit of economic viability.
- The IPO aims to attract ESG-focused investors as Thyssenkrupp transitions to a holding company model.
- Thyssenkrupp Marine Systems is benefiting from a globally increased demand for defense goods.
Community policy should be revised to address the financial implications of Thyssenkrupp's transition to a holding company model, considering the upcoming IPO of Thyssenkrupp Marine Systems (TKMS). Vocational training programs could be initiated in the steel and marine industries to prepare the workforce for the changing business landscape, especially with the costly transition to climate-friendly production systems.
