Jindal's bid to buy TK Steel Europe highlights CBAM, which offers 2 billion euros in green investments.
As Fastmarkets has learned, Jindal Steel International's non-binding offer to purchase Thyssenkrupp Steel Europe (TKSE) indicates that there is a potential competitive advantage in the region due to production without the use of CBAM.
This proposal is backed up by market sources, investments in "green steel" will amount to 2 billion euros ($2.14 billion) and will lead to earlier waves of consolidation of the European steel sector under the leadership of India.
Parent conglomerate Thyssenkrupp AG has confirmed that it has received a non-binding acquisition offer from Jindal Steel International to purchase its steel division. Thyssenkrupp AG accepted the offer, and Jindal published the announcement on Tuesday, September 16.
"The Executive Board of Thyssenkrupp AG will carefully consider this proposal, paying special attention to its economic feasibility, the continuation of the green transformation and employment in our metallurgical enterprises," the company said in a statement.
TKSE produces about 11 million tons of steel per year, employs about 27,000 people, and operates one of Germany's largest steel mills in Duisburg.
The context of restructuring
TKSE is currently working to reduce production capacity and staff numbers after reaching an agreement with the large German metalworkers' union IG Metall in July. By 2030, the company planned to reduce production from about 11 million tons per year to 8.7-9.0 million tons per year.
In July 2024, Thyssenkrupp sold a 20% stake in TKSE to EP Corporate Group (EPCG), the holding company of Czech billionaire Daniel Krzetinski, as part of efforts to reorganize his company. the steel division. Since then, EPCG and TKSE have been negotiating a 50:50 joint venture, although IG Metall criticized this agreement, citing a lack of clarity regarding the new shareholder's long-term strategy.
Meanwhile, Jindal did not disclose specific financial details of its proposal, but promised more than 2 billion euros for the completion of the direct reduction cast iron (DRI) plant in Duisburg and the installation of a new electric arc furnace (EDP).
According to one industry source, Jindal's interest in acquiring a major European steel asset is reminiscent of the strategic model developed by Lakshmi Mittal – in particular, its acquisitions in Germany in the late 1990s, followed by the creation of ArcelorMittal in 2006, which was seen as an example for Indian companies seeking expansion and consolidation. in Europe.
The takeover of Tata Steel Corus in 2007 was another example of Indian expansion into Europe. This deal is subsequently