According to CNN Money, “Germany’s Thyssenkrupp (TKAMY) and India’s Tata Steel announced plans to merge their European operations on Wednesday to create a new force in an industry that is under intense pressure from cheap Chinese exports.” The hope is that by amalgamating their operations, their combined output will allow them to push back against the very same Chinese steel producers.
Thyssenkrupp and Tata said their planned joint venture will be Europe’s second-largest steel producer with annual revenues of almost $18 billion. It will be headquartered in Amsterdam with more than 40,000 employees.
Despite the massive increase in revenue, the head of Thyssenkrupp, Heinrich Hiesinger, said that “even with the joint venture it will not be possible to avoid job cuts,” with the estimated number of layoffs being around 4,000.
Keep an eye on other steel and natural resources in and outside of Europe in the coming months. Companies will have little choice to adapt to the impact the merger. American steel has been one of the President’s focuses since taking office, insisting that American projects use American steel. With this new development, we may see new measures from the White House to help keep American steel going.
Learn more about Thyssenkrupp
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