Tata Steel merger deal nears

A DEAL to merge the European arm of Tata Steel, which runs the giant refinery in Port Talbot, and Germany’s ThyssenKrupp looks set to go ahead soon after the German elections on September 24 – if unions agree to it.

ThyssenKrupp has a board meeting scheduled for that week where the merger is expected to be discussed. The German engineer and steelmaker said: ‘An agreement could be possible before the end of this month.’

But trade unions oppose the deal. They would prefer ThyssenKrupp to list key operations, including its lifts division, on the stock market.

Activist investor Cevian, the firm’s second biggest shareholder, also opposes the deal.

Employees and shareholders are represented equally on the 20member board, so chairman Ulrich Lehner may have to use his casting vote. Tata said it was still in talks with the German firm.

The planned merger follows Tata Steel’s controversial move to shift 130,000 past and present staff into the Pension Protection Fund.

It persuaded regulators and trustees that the existing scheme’s deficit threatened the survival of the firm and agreed to put £550 million and a one third equity stake in Tata Steel UK into the lifeboat fund.