Steel tycoon Sanjeev Gupta has moved to expand his empire with an audacious bid for a German rival’s business.
The Indian-born, British businessman’s Liberty group has swooped on the legacy steel business of Thyssenkrupp, a tie-up that would bring together Europe’s second and fourth-biggest producers.
No details of the price being offered or the terms were revealed, but Liberty said it would ‘create a strong group well positioned to tackle the challenges faced by the European steel industry’.
Expansion plan: Sanjeev Gupta’s Liberty group has swooped on the legacy steel business of Thyssenkrupp
Gupta, 49, was dubbed the saviour of British steel when he rescued mills in Wales, Yorkshire and Scotland, protecting 4,500 jobs. His bid for part of Thyssenkrupp sent shares in the German firm soaring and analysts said it could set off a wave of deal-making in the sector.
A merger could face regulatory scrutiny however, after a tie-up of Thyssenkrupp and Tata Steel was blocked last year.
Gupta’s firm said: ‘Liberty Steel is convinced that a combination with Thyssenkrupp Steel Europe can be the right answer from an economic, social, and environmental perspective.
‘Discussions have been conducted on a non-exclusive basis, and there is no certainty that the discussions will lead to any agreement or transaction.’
Thyssenkrupp said it would carefully study the offer, even as it continues talks with other potential bidders.
However Germany’s most powerful union, IG Metall has opposed the deal, fearing it could lead to painful job cuts.
A sale would mark a radical change in Thyssenkrupp’s make-up, following the divestment of its elevators business.
Liberty is a division of UK giant GFG Alliance and comprises all of Gupta’s steel activities, with a view to a potential listing. It has been on a buying spree, most recently in France.
In Europe, it has 13m tons of annual capacity and 17,000 staff, compared with about 27,000 workers at Thyssenkrupp.
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