\n\tThyssenkrupp, Germany, and Tata Steel, India, have signed a memorandum of understanding to combine their European steel activities in a 50\/50 joint venture. Their aim is to create a leading European flat steel producer to be positioned as quality and technology leader. The new entity is set to have pro-forma sales of about $17 billion and a workforce of about 48,000, currently at 34 locations. Shipments are envisioned to be about 21 million tons a year.<\/p>\n
\n\tTo be named Thyssenkrupp Tata Steel, the planned joint venture will be managed through a lean holding company based in the Netherlands. It is to have a two-tier management structure comprising a management board and a supervisory board. Both boards are to have equal representation from Thyssenkrupp and Tata. The codetermination structures in Germany, the Netherlands, and Great Britain will be retained.<\/p>\n
\n\tThyssenkrupp intends to contribute its Steel Europe business to the planned joint venture. There are also plans for the joint venture to include Thyssenkrupp MillServices & Systems GmbH, a steel mill services provider that is part of the Materials Services business. Tata would add all of its flat steel activities in Europe.<\/p>\n
\n\tDr. Heinrich Hiesinger, CEO of thyssenkrupp AG, says, “Under the planned joint venture, we are giving the European steel activities of Thyssenkrupp and Tata a lasting future. We are tackling the structural challenges of the European steel industry and creating a strong No. 2. In Tata, we have found a partner with a very good strategic and cultural fit. Not only do we share a clear performance orientation, but also we have the same understanding of entrepreneurial responsibility toward workforce and society.”<\/p>\n
\n\tNatarajan Chandrasekaran, Chairman of Tata Steel says, “The Tata Group and Thyssenkrupp have a strong heritage in the global steel industry and share similar culture and values. This partnership is a momentous occasion for both partners, who will focus on building a strong European steel enterprise. The strategic logic of the proposed joint venture in Europe is based on very strong fundamentals and I am confident that Thyssenkrupp Tata Steel will have a great future.”<\/p>\n