ThyssenKrupp Mandates Banks for Steel Americas Review
First Published Wednesday, 27th June 2012 10:48 am - © 2012 Dow Jones
German steelmaker and engineering company ThyssenKrupp AG (TKA.XE) said Wednesday it has mandated banks to review strategic options for its Steel Americas operations in the U.S. and Brazil.
"This may involve a partnership or sale to a best owner whose strategy can better utilize the upstanding quality and fundamental competitiveness of the plants," the company said in a statement.
Goldman Sachs Group Inc. (GS) and Morgan Stanley (MS) are the banks designated.
In mid-May, the steelmaker said it was considering selling the steel mills in the U.S. and Brazil, or bringing in partners to sustainably improve performance.
At the time, ThyssenKrupp Chief Executive Heinrich Hiesinger declined to provide a time frame for a solution, citing the complexity of such transactions. But he said ThyssenKrupp had to act, after the operations accumulated losses of around 500 million euros, or around $624 million, in the first six months of the company's business year. In fiscal 2011, the losses had amounted to around EUR1 billion.
One trader noted that investors are aware the process could be both difficult and lengthy. At 1023 GMT, ThyssenKrupp shares were down 1% at EUR11.90.
-Herbert Rude contributed to this item.
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