The mood around Thyssenkrupp has shifted dramatically. After months of grinding uncertainty, a cascade of potential catalysts — from a record-breaking Canadian submarine contract to an unexpected cash infusion from the elevator market — has sent the stock rocketing higher. The shares surged over 8 percent on Wednesday to €9.47, extending a blistering run that has pushed the monthly gain past 32 percent.
Yet beneath the euphoria, the industrial conglomerate’s most troublesome asset remains a drag. The planned sale of the steel division to India’s Jindal Steel has hit a wall, with negotiations stuck on three critical fronts: future investment commitments, energy costs, and a €2.4 billion pension liability that neither side wants to shoulder alone.
A Canadian Prize Worth Billions
The most immediate game-changer lies across the Atlantic. On April 29, Thyssenkrupp Marine Systems (TKMS) submitted its revised bid for Canada’s submarine program, a project valued at a staggering €37 billion. Ottawa had rejected the Essen-based shipbuilder’s initial proposal, demanding a more extensive technology transfer to nurture a domestic defense industry.
TKMS has responded by forging a strategic alliance with BlackBerry’s Canadian subsidiary QNX, which will supply the operating system for the submarines. The partnership serves a dual purpose: it bolsters the technical offering while satisfying Canada’s insistence on local production. The only remaining competitor is South Korea’s Hanwha Ocean, and Ottawa is expected to name its preferred supplier by the end of June.
Should TKMS lose the Canadian bid, it has a formidable fallback. The German government is moving forward with plans to order new air-defense frigates worth an estimated €26 billion, with the budget committee likely to approve funding in late June.
The Elevator Payday
While the submarine deal would mark a triumph for the marine division, a separate transaction in the elevator industry is set to deliver a windfall to the parent company. Finnish rival Kone is pursuing a €30 billion takeover of TK Elevator, a business Thyssenkrupp sold to a private equity consortium in 2020. Market observers now estimate that the Essen group could receive roughly €4.7 billion in cash from the deal, as the original sale agreement included provisions for such secondary payouts.
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The resulting entity would become the world’s largest elevator manufacturer, leapfrogging industry heavyweights Otis and Schindler.
Steel’s Stubborn Standoff
The contrast with the steel division could hardly be starker. CEO Miguel López has drawn a firm line, refusing to offload the historic business at a discount. He has categorically ruled out a merger with domestic rival Salzgitter as a Plan B, warning instead that Europe risks becoming dangerously dependent on steel imports from Asia.
The talks with Jindal continue, but progress has been glacial. López insists the division’s valuation has improved, yet the pension obligations remain a major sticking point. The company still aims to sell a majority stake, but the timing remains uncertain.
A Broader Housecleaning
The restructuring effort extends beyond steel and submarines. Insider reports indicate that the Materials Services trading division, which generates €11 billion in annual revenue, is now under review. Management is weighing all options, including a spin-off, an initial public offering, or an outright sale.
The next major milestone arrives in May, when Thyssenkrupp releases its half-year results. The report will lay bare how much the struggling steel unit is eating into the profits of the thriving marine business. It will also provide the first official update on the Jindal negotiations since they entered their current deadlock. For investors, that document may finally clarify whether the conglomerate’s turnaround is gaining traction — or merely treading water.
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