The strategic sale of Thyssenkrupp’s struggling steel division has intensified with the unexpected entry of a second potential buyer. As exclusive negotiations with India’s Jindal Steel continue, a U.S.-based investment fund has now signaled its conditional interest in acquiring Thyssenkrupp Steel Europe.
Share Price Reacts to Bidder Interest
News of a competing expression of interest provided a temporary boost to market sentiment. Thyssenkrupp shares advanced by more than 1.5 percent following the announcement. For the German industrial group, divesting or carving out the steel business is a cornerstone strategy to permanently free itself from the division’s substantial investment and restructuring costs. Previous attempts to establish the unit independently through an IPO or a joint venture have been unsuccessful.
U.S. Fund Presents Conditional Offer
Michael Flacks, head of the namesake investment firm, told Reuters and the German newspaper F.A.Z. that his special situations fund is prepared to submit a bid. The Flacks Group’s offer, however, is contingent upon the collapse of the existing talks with Jindal Steel. No formal proposal is currently on the table, as the Indian steelmaker still holds exclusivity in the ongoing discussions.
Jindal Steel presented a non-binding takeover offer in September and is currently engaged in an in-depth due diligence process. The company is also working to secure approval from Germany’s IG Metall union and the relevant works council. Thyssenkrupp’s CEO, Miguel Lopez, confirmed in February that negotiations are being conducted intensively.
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Restructuring Costs and Job Cuts Loom
The steel unit is facing profound changes. Up to 11,000 of the approximately 26,000 positions at Thyssenkrupp Steel Europe are slated to be cut or outsourced in the medium term. The financial burden of this transformation is already evident, with restructuring costs amounting to 401 million euros in the first quarter of the 2025/2026 fiscal year alone.
According to the conglomerate, these measures have made the division more attractive to potential purchasers. They also underscore the significant financial pressure: the steel operation strains the group’s balance sheet through high capital requirements and persistently weighs on cash flow.
Green Hydrogen Plans Hit a Snag
Alongside the sale talks, the transition to climate-neutral production has encountered an obstacle. Thyssenkrupp Steel has temporarily suspended the tender process for green hydrogen at its Duisburg site. Submitted bids came in significantly above internal expectations, preventing an economically viable calculation. Despite this setback, construction of the direct reduction plant will continue.
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