Thyssenkrupp still hopeful deal with Tata will go through despite EU ‘doubts’
Thyssenkrupp still hopes there is scope for agreement with antitrust regulators on a planned joint venture with Tata Steel, despite reports Brussels is likely to block the deal.
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Tata Steel and Thyssenkrupp have put forward a plan to combine their European steel operations to form the second-biggest steel maker in the region. But the landmark deal is yet to be approved by EU antitrust regulators because of concerns it will reduce competition in the market.
This morning reports surfaced saying the deal was increasingly likely to be shelved unless the firms offered greater concessions, because it would lead to less choice and cause higher prices.
The reports in the Financial Times said regulators were concerned about the impact on prices of steel used in the car industry and electrical products.
A ThyssenKrupp spokesman said: “The Competition Commission has taken the reworked commitments proposed by ThyssenKrupp and Tata Steel as an opportunity to conduct another market test.”
“There are still a number of ways to adjust our commitments without compromising the commercial logic of the joint venture.”
Late last month, the European Commission extended the deadline for making a decision on the planned joint venture by seven working days until June 17.
ThyssenKrupp said further talks were planned with EU Competition Commissioner Margrethe Vestager in the coming week.
Vestager will be forced to decide on the deal at a politically sensitive time in Brussels, with elections for the European Parliament due to take place this month with many of the key executive positions for the EU up for grabs.
Read more: Is Tata considering walking away from its Thyssenkrupp plan?
Steel industry experts have said consolidation is extremely important as the industry struggles to deal with overcapacity, cheap imports and US tariffs.