Thyssenkrupp ends talks with Liberty on steel unit sale

FRANKFURT: German conglomerate Thyssenkrupp ended talks to sell its steel division to Britain’s Liberty Steel due to differences over value, the latest setback in efforts to consolidate the European sector.

Liberty Steel, led by commodities tycoon Sanjeev Gupta, last month submited a firmedup non-binding bid for Thyssenkrupp’s steel unit, Europe’s second biggest in terms of sales, which sources said included commitments to protect jobs and sites.

“We regret this step because we perceived Liberty Steel as a serious partner in the process,” Thyssenkrupp Chief Financial Officer Klaus Keysberg said in a statement.

Thyssenkrupp’s move to terminate talks shits the focus to the group’s two other scenarios for its steel division: keeping it or spinning it off to shareholders. Both would entail major additional cost and job cuts.

Shares in the company were almost unchanged ater falling as much as 6.2%.

“To end talks also shows a position of strength,” a local trader said, adding Thyssenkrupp’s steel unit had improved markedly in recent months.

The move comes ater Sweden’s SSAB last month abandoned plans to buy the Dutch operations of India’s Tata Steel, a sign of how challenging consolidation is in a sector plagued by overcapacity.

In an internal memo to staff, Keysberg said differing views over the value of the division, financing structure and guarantees were the key reasons to end discussions.