Thyssenkrupp, an industrial conglomerate from Germany, is set to divest the DAX of 30 leading stocks on the Frankfurt Stock Exchange, operator Deutsche Boerse said on Wednesday evening.
Thyssenkrupp will leave DAX on 23 September and will be replaced by MTU Aero Engines, a manufacturer of aircraft engines. This is the second founding member of the 30 member index to graduate in the past 12 months.
Thyssen, which merged with rival Krupp two decades ago, has been a member of DAX since its founding in 1988. Last year, founding member Commerzbank dropped out of the index, and was replaced by payment company Wirecard.
After four profit warnings and two failed restructuring attempts, Thyssenkrupp's shares fell 42% last year. The European Commission's decision to block the merger of Thyssenkrupp with India's Tata in June exacerbated the fall.
The stock market operator's decision adds another to the company's long list of problems. Thyssenkrupp's positions were downgraded last month by S & P and Moody 's amid a cooling global economy.
For CEO Guido Kerhoff, dropping out of DAX marks another setback in his efforts to revive the sprawling group by selling its elevator business.
"There is no doubt that we are disappointed with the exit from the DAX," Chief Executive Guido Kerhoff said in a statement to French AFP.
“It is important for us now to restructure the business and restore the company's profitability in order to regain investor confidence,” the statement said.
Metzler Bank analyst Pascal Spano believes that Thyssenkrupp today “is just a shadow of the old company.
