Tata Steel-Thyssenkrupp JV seen credit neutral amid high leverage: Fitch

JV to improve Tata Steel business profile by reducing exposure to structural weakness in Europe

Tata Steel's definitive agreement with ThyssenKrupp AG to create a 50:50 steel joint venture (JV) in Europe will improve the former's business profile by reducing its exposure to structural weaknesses in the region. However, the gain will probably be offset by a relatively high level of leverage over the next two to three years due to acquisitions in India to expand market share, Fitch Ratings said in its report on Tuesday.

"We expect to resolve the Rating Watch on the ratings of Tata Steel and ThyssenKrupp after completion of the JV transaction by end-2018," said the agency.

Details revealed by the companies