According to Japanese media, India’s Tata Steel and German’s ThyssenKrupp Group announced on 20th, they have reached to an agreement on merging Europe’s steel business and will invest 50% respectively during 2018 to establish a joint venture, in order to resist China’s steel industry pressure.
It is understood that he European business total sales of the two mentioned companies reach to 15 billion Euros, employees amount is 48,000. With the merger of the two companies, the annual steel supply will reach 21 million tons, and is neck and neck with the world's 13th Korea Hyundai Iron and Steel.
The new company called "ThyssenKrupp Tata Steel", will become the second largest steel company in Europe after ArcelorMittal, headquartered in Amsterdam, Netherlands, with a maximum layoff of 4,000 People to improve the efficiency of procurement and logistics.
The article writes that the performance of European companies has deteriorated rapidly as a result of the rising Chinese steel squeeze. Only ArcelorMittal is European company that has been at the forefront of the world's production rankings, , and many European steel companies are facing worse earnings.
Meanwhile, France and US put forward the prohibition of selling engine cars and pure electric vehicle body weight will affect the driving distance. Therefore, there will be a light weight trend. The steel application of per vehicle may reduce so the steel companies’ sense of crisis is improving.
It is reported that although the current market is recovering, the two mentioned companies think that it is still difficult to survive alone.
India's largest consortium, chairman of the Tata Group, Tata Steel chairman Tara Zhan Chandrasekhar said, the combined business will obtain the effect of supplement each other, and jointly cope with structure change, build a strong Europe's second largest enterprises.