ALSO READThyssenkrupp CEO keen for Tata steel merger deal before end-September: sources Thyssenkrupp won't rush into Tata Steel merger: CFO Thyssenkrupp signals steel merger decision by end Sept - works council Thyssenkrupp signals steel merger decision by end Sept -works council Tata pension deal raises questions for Thyssenkrupp merger
FRANKFURT/DUESSELDORF (Reuters) - Thyssenkrupp could reach an agreement in principle this month to merge its European steel business with that of Tata Steel, the group said on Monday, adding talks were constructive and had entered the final stretch.
Shareholders last week put pressure on Thyssenkrupp to clinch a deal after talks over a potential steel combination dragged on for a year and a half, mainly held up by negotiations over Tata Steel's British pension liabilities.
A spokeswoman for Thyssenkrupp said both groups were close to a memorandum of understanding (MoU), paving the way for a detailed look at one another's books and detailed negotiations before creating the second-largest steelmaker in Europe.
Thyssenkrupp Chief Executive Heinrich Hiesinger favours a steel joint venture, saying this would be the best option to eliminate overcapacities in the volatile steel sector but drawing opposition from labour representatives, who fear cuts.
Trade union IG Metall said it remained opposed to a joint venture, adding there were no signs the labour representatives it has on Thyssenkrupp's supervisory board would agree.
Monthly Manager Magazin reported that Thyssenkrupp's supervisory board could agree to a combination either on Sept. 23 or 24, citing people involved in the negotiations.
A spokesman for Thyssenkrupp's works council confirmed that a board meeting initially scheduled for Sept. 12 had been pushed back to Sept. 23 or 24.
(Reporting by Georgina Prodhan and Tom Kaeckenhoff; Writing by Christoph Steitz; Editing by Maria Sheahan)
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)