Capital market-relevant press releases, 2006-08-11, 02:00 PM
Supervisory Board meeting of ThyssenKrupp AG
NAFTA strategy of the Steel and Stainless segments
As part of their forward strategies for profitable growth, ThyssenKrupp Steel AG and ThyssenKrupp Stainless AG plan to jointly build a new plant in the USA. This greenfield project is intended to significantly strengthen their position in North America. The NAFTA market is one of the biggest volume markets for high-grade flat carbon steel. Above-average growth is forecast in the coming years for stainless steel flat products.
At its meeting today, the Supervisory Board of ThyssenKrupp AG approved a project development budget of US$50 million, to be used to commission consultancy and engineering services, prepare the choice of site and purchase the real estate.
Central to the plans for the greenfield project is the construction of a hot strip mill which will be used primarily to process slabs from the new CSA steel mill in Brazil. The new plant will also feature cold rolling and hot-dip coating capacities for high-quality end products of flat carbon steel. ThyssenKrupp Steel's investment in the plant, which will have an annual capacity of 4.5 million metric tons of end products, is estimated at EUR1.8 billion.
In addition, ThyssenKrupp Stainless plans to build a melt shop with an annual capacity of up to 1 million metric tons of slabs, which will be processed on the hot strip mill. A cold rolling facility is also to be erected which, in the first phase, will be designed to produce 325,000 tons of cold strip and 100,000 tons of pickled hot strip. Furthermore, ThyssenKrupp Mexinox will be supplied with hot strip from the USA as starting material. The volume of investment by Stainless is expected to be EUR500 million.
The ideal site is being sought for this joint plant complex. Three potential locations have now been identified in the southeastern states of Alabama, Arkansas and Louisiana.
In the next few days, the Executive Board will continue negotiations on the acquisition of the Canadian steel producer Dofasco. In January 2006, ThyssenKrupp signed an agreement with Mittal Steel Company N.V. under which Mittal Steel undertook to sell Dofasco to ThyssenKrupp AG in the even of a takeover of Arcelor.
Automotive supply business to be reorganized - focus on five segments
The business activities of the ThyssenKrupp Automotive segment are to be reorganized. The reason for this is the well-documented need for restructuring in the body and chassis operations, particularly in North America, which are facing structural and economic difficulties. These North American body and chassis businesses (sales of around EUR1 billion and 4,000 employees) are to be sold. Discussions are currently underway with potential buyers. As part of the reorganization, the ThyssenKrupp Automotive and ThyssenKrupp Technologies segments are to be merged effective October 01, 2006, subject to the approval of the responsible boards. As a result, the ThyssenKrupp Group will then be organized in the five segments Steel, Stainless, Technologies, Elevator and Services.
As part of the merger of ThyssenKrupp Automotive and ThyssenKrupp Technologies, their head offices will also be combined at the present location of ThyssenKrupp Technologies in Essen. Discussions will be held with the relevant bodies about the consequences for the employees concerned, especially those from the Bochum location. The objective is to find a socially compatible solution avoiding redundancies through HR measures such as transfers, further training and early retirement.
Dr. Wolfram Mörsdorf, member of the Executive Board of ThyssenKrupp AG and currently responsible for the Automotive segment, will in the future assume responsibility for the Mechanical Components business of the Technologies segment. To this end, he is to be appointed Vice Chairman of the Executive Board of ThyssenKrupp Technologies AG. His seat on the Executive Board of ThyssenKrupp AG remains unaffected by this. Dr. Olaf Berlien will remain Executive Board Chairman of ThyssenKrupp Technologies AG.
Executive Board to be reduced to eight members
Effective December 1, 2006, the Executive Board of ThyssenKrupp will comprise eight members.
Gary Elliott (62), Chairman of the Executive Board of ThyssenKrupp Elevator AG and member of the Executive Board of ThyssenKrupp AG, will resign these positions at September 30, 2006. It was planned that he should replace Dr. Siegfried Buschmann (69) as Chairman of the ThyssenKrupp national holding company in the USA and as the Group's NAFTA representative upon expiry of his contract in July 2007. By agreement with Gary Elliott, he will now resign as Executive Board Chairman of ThyssenKrupp Elevator and Executive Board member of ThyssenKrupp AG at the end of the current fiscal year 2005/2006 and succeed Siegfried Buschmann with effect from October 01, 2006. During his period of office, Gary Elliott has presided over the dynamic growth of the Elevator segment, with sales tripling and earnings increasing fourfold. The Canadian will support ThyssenKrupp's NAFTA strategy. Subject to the approval of the Supervisory Board of ThyssenKrupp Elevator, he will be succeeded in his position at ThyssenKrupp Elevator by Edwin Eichler (48), who will also remain Chairman of the Executive Board of ThyssenKrupp Services AG and member of the Executive Board of ThyssenKrupp AG.
Dr. A. Stefan Kirsten (45) has informed the Supervisory Board that due to changes in perspectives in the ThyssenKrupp Group he will not be seeking to extend his contract as Chief Financial Officer when it expires on July 31, 2007. The Supervisory Board respects this decision and has requested Dr. Kirsten to remain in his position until the annual financial statements are established on November 30. Kirsten has been Chief Financial Officer of ThyssenKrupp since 2002. During this time, the Group's debt has been rapidly reduced and accounting switched to IFRS. Dr. Kirsten's departure will be an amicable one; he will continue to sit on various supervisory boards within the Group. His duties will be taken over by Executive Board Vice Chairman Dr. Ulrich Middelmann (61), who will also remain responsible for Controlling and Mergers & Acquisitions.
The Supervisory Board of ThyssenKrupp AG thanks Gary Elliott and Dr. Stefan Kirsten for their work on the Executive Board of ThyssenKrupp AG and as Chairman of the Elevator segment.