ThyssenKrupp AG is to shrink and focus on higher-margin businesses as the COVID-19 pandemic hastens the break-up of one of Germany’s last mega-conglomerates.
The company said it is considering the sale of units that make steel and submarines as it fights for survival.
Once a byword for German engineering prowess, ThyssenKrupp is to be gradually split apart, as chief executive officer Martina Merz aims at reviving the group after the US$19 billion sale of its elevator unit closes later this year.
Photo: Reuters
‘DIFFICULT DECISIONS’
“We have taken some difficult decisions that were long overdue,” Merz said in a statement on Monday. “ThyssenKrupp will emerge smaller but stronger from the transformation.”
The steel unit, the traditional heart and soul of the company, burned through more than 1 billion euros (US$1.09 billion) in cash in the six months ending March 31. It has struggled for years against cheaper competition from Asia.
ThyssenKrupp’s European steel business had sales of 4.37 billion euros in the six months through March, while its Marine Systems unit had sales of 235 million euros over the same period.
The company said a cluster of loss-making businesses, including its plant technology unit that constructs factories, would also be dropped from its portfolio, with outright closures of heavy plate steel and battery solutions divisions an option.
It will look to develop its raw materials distribution and its components units.
ThyssenKrupp’s rising debt underscores the shrinking room for maneuver. The company’s net debt stands at 7.55 billion euros, according to earnings figures released last week, a figure likely to rise as the fallout from the pandemic cripples the global economy.
ThyssenKrupp already held exploratory steel talks with Salzgitter AG, people familiar with the matter said last year.
Chinese and Indian peers had also expressed interest in ThyssenKrupp’s European steel operations, the people said.
Sweden’s SSAB AB is also among the potential partners, one of the people said.
While the European Commission blocked a planned merger of ThyssenKrupp Steel with Tata Europe last year, both companies could revisit a deal and potentially sell or close steel plants to allay antitrust concerns, some of the people said.
MERGER?
ThyssenKrupp said it was in intensive discussions over a merger of the Marine Systems business, which builds submarines and other military ships, with a combination with a national or European competitor an option. The unit has run into project overruns in recent years.
“We have left no stone unturned in very carefully examining the individual development potential of each business for ThyssenKrupp,” Merz said. “The sale of the elevator business gives us the capacity for action.”
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
Among the rows of vibrators, rubber torsos and leather harnesses at a Chinese sex toys exhibition in Shanghai this weekend, the beginnings of an artificial intelligence (AI)-driven shift in the industry quietly pulsed. China manufactures about 70 percent of the world’s sex toys, most of it the “hardware” on display at the fair — whether that be technicolor tentacled dildos or hyper-realistic personalized silicone dolls. Yet smart toys have been rising in popularity for some time. Many major European and US brands already offer tech-enhanced products that can enable long-distance love, monitor well-being and even bring people one step closer to
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last
RECORD-BREAKING: TSMC’s net profit last quarter beat market expectations by expanding 8.9% and it was the best first-quarter profit in the chipmaker’s history Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), which counts Nvidia Corp as a key customer, yesterday said that artificial intelligence (AI) server chip revenue is set to more than double this year from last year amid rising demand. The chipmaker expects the growth momentum to continue in the next five years with an annual compound growth rate of 50 percent, TSMC chief executive officer C.C. Wei (魏哲家) told investors yesterday. By 2028, AI chips’ contribution to revenue would climb to about 20 percent from a percentage in the low teens, Wei said. “Almost all the AI innovators are working with TSMC to address the