Germany's Thyssenkrupp to press ahead with corporate restructuring

BERLIN, Feb. 14 (Xinhua) -- The German industrial behemoth Thyssenkrupp views the looming merger of its steel unit with Tata Steel Europe as being only the first step in a wider corporate restructuring effort, the company told press on Wednesday.

"Of course, the company will change once we have completed a steel joint venture," Thyssenkrupp chief financial officer (CFO) Guido Kerkhoff said at the presentation of his firm's quarterly earnings figures. The management is to hold consultations throughout the spring on how to adapt its strategy.

Earnings figures published by the industrial firm showed its financial position improved during the first quarter (Q1) of the financial year thanks in part to a recovery of the global steel market.

However, revenue and new orders both declined in the first quarter by three percent two percent respectively. Net earnings were 78 million euros (96.8 million U.S. dollars) in Q1 despite a one-off tax payment of 87 million euros as a result of the reform of the U.S. corporate taxation system.

Thyssenkrupp's steel division hereby benefited from rising prices which lifted the division's operative income to 160 million euros. The lion's share of corporate earnings was contributed by the elevator division.

At Thyssenkrupp's recent annual general meeting in January, chief executive officer Heinrich Hiesinger faced harsh criticism by some shareholders for not being ambitious enough in his corporate restructuring plans. The Swedish investment fund Cevian went as far as to call for the integrated industrial conglomerate to be broken up into its constituent parts.

Speaking on Wednesday, Kerkhoff highlighted the progress that had been made so far in negotiations with labor representatives over the fusion of Thyssenkrupp's steel unit with Tata Steel Europe.

In a referendum organized by the trade union IG Metall, workers recently voted in favor of the joint venture in principle while refusing to fully endorse the plans until more details became available.

Nevertheless, Kerkhoff expressed optimism that a final joint venture agreement could still be signed "at the start of 2018", with the merger being completed in 2019.

Thyssenkrupp has announced its intention to initially retain a 50-percent stake of the new Netherlands-based corporate entity and is currently still deciding whether to dispose of its shares in an initial public offering thereafter. Enditem