Reuters, November 22, 2016, Frankfurt/Duesseldorf: Thyssenkrupp (TKAG.DE), a German company, announced on Wednesday that its steel unit had lost 2.1 billion euros ($2.3 billion) in value because of a “gloomy” outlook. This shows how hard it is to get Czech energy group EPH to become a co-owner of the business.
Thyssenkrupp, which has been trying to sell its steel business for years, had a 2-billion-euro net loss for the fourth quarter because of the impairment. In the three months from July to September, adjusted net profit dropped by 45% to 88 million euros.
“The figures show that we have made progress with the transformation of Thyssenkrupp, despite the difficult environment, but also that we must continue to work hard at raising the performance of our businesses,” Miguel Lopez, CEO of Thyssenkrupp, said.
In addition to steel, Thyssenkrupp makes submarines and car parts and runs a big business selling materials. The company said it was in good, open-ended talks with EPH about a possible steel joint venture.
The Czech billionaire Daniel Kretinsky owns EPH. The company said that it would help Thyssenkrupp Steel Europe with any joint venture by using its energy knowledge.
Thyssenkrupp warned last month that the steel market was getting much worse. They claimed that a combination of weak economies in Germany and other markets, as well as higher costs for raw materials and energy, had dashed optimistic expectations.
Cheap steel from China coming into Europe has been another problem. Also, Asian competitors don’t have to pay for CO2 emissions, which puts European companies at a disadvantage.
