Brussels has started the clock on a review of the European steel operations merger of Tata Steel and ThyssenKrupp, a landmark deal that would create Europe’s second largest steel producer. Europe’s competition commission opened its initial investigation into the tie-up on Tuesday and will need to decide by 10 October to either approve it or launch an in-depth probe. The investigation will examine how the deal could cut competition and may require the sale of assets in areas where the two companies have significant overlap.
Tata Steel and ThyssenKrupp will join their steelmaking operations on the continent to create a 50-50 joint venture with EUR 17 billion in revenues and 48,000 employees. TK-Tata would control roughly 27 per cent of the European market for flat steel, behind ArcelorMittal with 38 per cent. Problems are most likely to come in the speciality and niche product areas where the combined group would be strongly dominant, such as tin-plate for food packaging and electrical steels.
Source : FINANCIAL TIMES
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