Daily Management Review

EU watchdogs block Tata Steel-ThyssenKrupp merger


The European Commission announced ban on the merger of Tata Steel and ThyssenKrupp, explaining this decision by concerns about rising prices and reducing competition in the steel market in Europe.

The EC statement on the refusal to approve this transaction notes that ThyssenKrupp and Tata Steel are ranked second and third respectively among the carbon steel producers in the European Economic Area. According to the authorities of the European Union, the merger of companies "would lead to a decrease in competition and raise prices for various types of steel."

The EC also noted that the proposed options to remove these concerns were negatively evaluated by market participants. The decision to ban the transaction was announced following an investigation by the European Commission, which was initiated in October 2018 for a possible violation of EU antitrust laws after companies announced their intention to create a joint venture.

European Commissioner for Competition Margrethe Vestager commented on the decision, stating that the merger of Tata Steel and ThyssenKrupp was prohibited "to avoid significant damage to European industrial customers and consumers."

source: reuters.com