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Liberty House Mulling Bid for Thyssenkrupp Steel Unit - Reports

Steel News - Published on Fri, 16 Oct 2020

Image Source: Liberty Thyssenkrupp
There have been many turning points in the more than 130-year history of the two Ruhr groups Thyssen and Krupp. The unsuccessful hostile attempt to take over Thyssen by Krupp in 1997 is just as much a part of it as the resulting merger of the two industrial groups two years later or the failure of the planned steel marriage with the Indian Tata group in 2019.Friday, October 16, 2020, could be another turning point. Then a preliminary decision could be made as to whether the traditional Essen company will actually cut its roots and sell its actual core business with the steel division. According to media reports, Mr Sanjeev Gupta’s UK-headquartered Liberty House is preparing a bid to buy the lossmaking steel operations of Germany’s Thyssenkrupp and could make an announcement as soon as Friday.

A tie-up would merge the activities of Europe’s fourth and second-biggest producers of steel. However, it would probably encounter stiff opposition from unions, who fear job losses and are lobbying for the German state to take a stake in the beleaguered unit.

News of Liberty Steel’s interest, first reported by German magazine Spiegel, comes a day before planned protests by steel workers to put more pressure on the government to bailout Thyssenkrupp’s steel unit, which made a nine-month operating loss of 700 million euros

The Indian born magnate’s ascent within a few years from obscure commodities trader to globe-trotting industrialist running a USD 20 billion business empire has sparked scrutiny of the finances of GFG Alliance, the family owned collection of investments to which Liberty belongs. Any approach by Liberty will inevitably lead to questions on how it would finance a takeover. Its rapid growth has largely relied on often expensive forms of borrowing related to unpaid customer bills, while Mr Gupta has also leant on public authorities for support.

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Posted By : Yogender Pancholi on Fri, 16 Oct 2020
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