Thyssenkrupp Plans to Split into Two Companies

By Ruth Bender and Nathan Allen

BERLIN -- German steel conglomerate Thyssenkrupp AG is planning to split into two listed companies, the company said Thursday, taking a drastic strategic move following months of pressure from activist shareholders to improve profits and find a simpler structure.

Thyssenkrupp said the split would take place in the form of a spinoff, with two companies equal in size -- one comprising the company's materials operations and the other the group's capital goods businesses, which include the elevator and automotive components segments. Both companies will be listed and keep the name Thyssenkrupp.

"The management board is convinced that this new structure will allow the businesses to develop better and concentrate on their strengths," Thyssenkrupp said in a statement.

The company said it would propose the split to its supervisory board in a meeting Sunday. If the board approves, the split is still subject to shareholder approval.

Shares jumped 18% on the news, bringing relief to investors after months of turmoil at the German industrial icon, which has seen its share price plunge.

"This could be a decisive turning point," said Marc Gabriel, an analyst from Bankhaus Lampe.

(More to Come)

(END) Dow Jones Newswires

September 27, 2018 13:05 ET (17:05 GMT)

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