GO
Loading...

UPDATE 2-ThyssenKrupp postpones results as deal on U.S. plant nears

Wednesday, 20 Nov 2013 | 1:00 AM ET

* ThyssenKrupp says in exclusive talks to sell its U.S. plant

* Pushes back results to Dec. 2 from Nov. 21

* Says talks include slab supply contract for CSA

* ThyssenKrupp open as to whether talks will lead to a deal

* ArcelorMittal consortium to sign deal - paper

FRANKFURT, Nov 19 (Reuters) - German steelmaker ThyssenKrupp pushed back the publication of its annual financial results as talks to sell a steel plant in the United States entered the home stretch.

"ThyssenKrupp is in exclusive negotiations on the potential sale of the U.S. steel plant in Calvert, Alabama," the company said late on Tuesday, adding it was postponing publication of its earnings to Dec. 2 from Nov. 21.

ThyssenKrupp has been trying for more than a year and a half to find a buyer for its Steel Americas business - comprised of the Calvert plant and a steel mill in Brazil - which has caused losses and sapped capital at Germany's biggest steelmaker for the past few years.

The book value of Steel Americas as a whole has shrunk to 3.3 billion euros ($4.5 billion) from more than 7 billion euros, with analysts estimating Calvert accounts for about 45 percent.

ArcelorMittal said earlier this month it was interested in the Calvert plant and Handelsblatt newspaper reported on Wednesday a consortium led by the world's largest steelmaker was close to signing a deal.

Brazil's Cia Siderurgica Nacional SA (CSN) was originally seen as the most likely buyer of both Steel Americas mills, but price and ThyssenKrupp's future involvement are believed to be sticking points.

A source familiar with the situation told Reuters in September that ThyssenKrupp could give up trying to sell the plant in Brazil, having made no progress in sales negotiations with CSN.

Analysts have said a partial sale of Steel Americas would still be better than no sale at all, though it would be a disappointment if the plant in Brazil remains on ThyssenKrupp's books. The plant, known as CSA, is 73 percent owned by ThyssenKrupp while the rest is held by Brazil-based iron ore miner Vale SA.

A sale of just the U.S. plant could bring in proceeds of between $1.5 billion to $2 billion and result in a further writedown on the value of Steel Americas, analysts say.

Earlier on Tuesday, two bankers familiar with the matter told Reuters that ThyssenKrupp was stepping up preparations for a capital hike in a bid to shore up its strained balance sheet.

ThyssenKrupp said on Tuesday its talks to sell the Calvert plant also included a long-term contract for CSA, "a solution that would secure the value of the Brazilian steel mill."

"Whether the transaction will be brought to a successful conclusion is still open at present," it said, without naming the companies it was negotiating with.

  Price   Change %Change
TKA
---