Germany's largest steelmaker Thyssenkrupp said a planned spin-off of its steel operations was under threat due to Russia's attack on Ukraine.
The German industrial conglomerate is no longer able to spin off its steel business due to economic conditions, according to a company announcement late Wednesday. Thyssenkrupp said last month that the split would not happen before the middle of the year due to regulatory and other hurdles.
"The economic impact of the war in Ukraine on the development of the group's business is impacting spin-off plans," the company said. However, Thyssenkrupp "remains convinced that the independent positioning of the steel business offers very good prospects for the future."
The company also suspended its full-year pre-M&A free cash flow forecast, citing the impact of the Ukraine turmoil on commodity prices, which primarily affects its steel and automotive businesses.
“While the group’s sales in Russia and Ukraine are negligible, at well less than 1% of total sales, the executive board estimates that the group’s business performance will be affected by the far-reaching macroeconomic and geopolitical impact of the war in Ukraine,” the statement reads.
Thyssenkrupp shares fell 8.6% after the announcement. Since the beginning of the year, the group's shares have fallen by more than 10%.
