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Thyssenkrupp Chairman Defends Urgent Stake Sale Decision

Thyssenkrupp Made Urgent Steel Sale to Kretinsky Despite Labour Disputes

by Ikeoluwa Ogungbangbe

At a time when every decision counts, Thyssenkrupp’s leadership is under intense pressure to secure the future of its steel division, TKSE, despite growing internal discord and market challenges. The company’s chairman, Siegfried Russwurm, has openly defended the decision to sell a 20% stake in the steel unit to Czech billionaire Daniel Kretinsky, despite opposition from worker representatives and the looming threat of industrial action.

During an interview with the German publication Welt am Sonntag, Russwurm stressed the urgency of addressing the challenges faced by the steel unit, which he described as “rough waters.” The company’s stagnant progress in revitalizing the steel division has prompted this move to initiate a partnership with Kretinsky. This strategic shift aims to mitigate the risks that have been dragging down the conglomerate’s overall performance.

The tension between management and labor representatives, who hold half of the seats on Thyssenkrupp’s supervisory board, has escalated into an open conflict. The labor leaders argue that they have been excluded from crucial decision-making processes regarding the sale of the steel business. The situation reached a stalemate that was only resolved when Russwurm used his tie-breaking vote as chairman—a move he did not discount using again if necessary to push through vital decisions.

Russwurm warned of the severe implications that any halt in production, possibly due to strikes, would have on the business. He emphasized the need for immediate solutions to stabilize the steel unit, rather than postponing decisions indefinitely. “The steel business must no longer be the risk that drags down all other areas of the group. We need a solution, not maybe or at some point, but now,” Russwurm stated firmly.

The financial stakes are high, with Germany’s largest union, IG Metall, indicating earlier in the week that TKSE would require an injection of 4 billion euros ($4.3 billion) to sustain itself independently in the future. In response, Thyssenkrupp is pursuing a strategy to form a 50:50 joint venture with Kretinsky, aiming to reduce its financial burden while seeking a viable path forward for the steel division.

Russwurm called on all parties involved, including labor unions and other business partners, to work together to create a long-term plan for TKSE. Compounding its problems, the steel unit has been especially exposed to growing energy prices and the flood of lower-priced Asian imports.

The warning from the chairman, “Otherwise, it is only a matter of time before this company no longer exists,” emphasized a very real threat. Russwurm’s haste is a reflection of the delicate situation that Thyssenkrupp’s steel division finds itself in right now, stressing the broader implications for the company and its employees should decisive action not be done quickly.

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