Major Salzgitter shareholder mulls takeover bid

Salzgitter announced on Monday that its second-largest shareholder GP Gunter Papenburg is considering a possible takeover of the German Steelmaker with a partner.

The offer is only valid if TSR Recycling and the two-party consortium reach a minimum of 45% of Salzgitter plus one share.

Salzgitter has not disclosed the price of its offer.

The news caused the shares of the Frankfurt-listed company to rise by nearly 26% as early as 1854 GMT.

GP Gunter Papenburg holds 25,1% of Salzgitter. This is slightly less than the 26,5% held by Lower Saxony in Germany, where Salzgitter has its headquarters.

Salzgitter began cost-cutting measures in August across all of its businesses after a tough steel market in Germany caused a net loss for the second quarter.

Thyssenkrupp Salzgitter, and France's Vallourec reviewed a possible sale of their joint venture HKM in July after being approached by a buyer. In October, it was reported that Thyssenkrupp has its sights set on a 50/50 joint venture in steel with Czech billionaire Daniel Kretinsky. Thyssenkrupp Steel Europe's sweeping restructuring could include the sale or closure HKM.

Salzgitter reported in October that it had cut its forecast for the full year and that its earnings were down during the first nine-months of 2024. This was against a backdrop of an economic climate which has been weakening. (Reporting and editing by Anil D’Silva; Shailesh Kumar, Christoph Steitz and Anil Dugar)

(source: Reuters)