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Capital market-relevant press releases, 2001-04-26, 02:00 AM

ThyssenKrupp and Babcock Borsig agree to closer cooperation in shipbuilding

Essen/Oberhausen, April 26, 2001. ThyssenKrupp Technologies AG (Essen), Babcock Borsig AG (Oberhausen) and ThyssenKrupp AG today agreed in a memorandum of understanding to seek closer links in their shipbuilding activities. As a first step toward intensifying cooperation, each party intends to acquire a capital interest in the other before the end of the year. ThyssenKrupp Technologies AG will purchase a 7.5 percent share in Howaldtswerke-Deutsche Werft AG (HDW) and Babcock Borsig a 7.5 percent stake in ThyssenKrupp Werften GmbH. The plan is to increase these holdings to 15 percent in a second step in 2002.

For HDW (Kiel), Blohm+Voss (Hamburg) and Thyssen Nordseewerke (Emden), the targeted cross shareholdings will represent an important step toward harmonizing and pooling their technological capabilities. With this agreement, ThyssenKrupp and Babcock Borsig are also laying the foundations for a European shipyards solution.

Both parties today informed the German defense minister in Berlin about the memorandum of understanding. In October last year, a joint declaration was signed by the German chancellor and defense minister and engineering companies in the German army and naval sectors on which ThyssenKrupp and Babcock Borsig are basing the closer ties between their shipbuilding activities in the sense of a strategic alliance and corporate integration.

HDW, Blohm+Voss and Thyssen Nordseewerke have already been cooperating successfully for several years, in particular on military and occasionally civilian projects. The HDW group achieved sales of euro574 million in fiscal year 1999/2000 (ending September 30) with 3,300 employees; sales of the ThyssenKrupp Werften group were euro779 million with a workforce of 2,889. Orders in hand on March 31 totaled euro5.5 billion at HDW and euro3.1 billion at Thyssen Krupp Werften.

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