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Kallanish Kallanish

Knowledge matters Knowledge matters

October, 27th 2020

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OCT 16
11:21

Liberty makes non-binding offer to acquire thyssenkrupp steel

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Liberty Steel has made a non-binding indicative offer to acquire the steel unit of thyssenkrupp, the rapidly-expanding steel group confirms. The offer is supported by a number of financial institutions. Liberty says it wants to intensify the dialogue with thyssenkrupp and to engage in further due diligence to present a potential binding offer.

“With both transformation experience and an entrepreneurial approach, a possible combination of LIBERTY Steel and thyssenkrupp Steel would create a strong group well positioned to tackle the challenges faced by the European steel industry and accelerate the transformation to GREENSTEEL,” Liberty Steel says in a note seen by Kallanish.

“From an economic perspective, there is potential for a compelling industrial concept given that the businesses are complementary with respect to assets, product lines, customers, and geographic footprint,” the group continues.

The combination of the two steel groups would help the EU steel industry move towards the bloc’s aim to become climate neutral by 2050 as part of the European Green Deal announced last December. Liberty’s own target is to become carbon neutral by 2030.

Liberty’s discussions with thyssenkrupp have been conducted on a non-exclusive basis, and there is no certainty that the discussions will lead to any agreement or transaction.

Were the acquisition to materialise, it would continue a stunning expansion for Liberty Steel, which just over five years ago was known mainly as a trading house. It now stands to become the main steelmaking competitor in Europe to ArcelorMittal.

Interestingly, given the potential thyssenkrupp acquisition news, Liberty parent GFG Alliance has appointed Premal Desai as its new Group Chief Operating Officer effective 1 January 2021. Desai held several leadership positions at thyssenkrupp AG from 2006 to 2020, most recently as chief financial officer and executive chairman of thyssenkrupp Steel.