Jindal Steel’s Thyssenkrupp Acquisition Talks Stall Due to Key Disagreements
Six months after steel magnate Naveen Jindal made an unsolicited bid to acquire the steel assets of Germany’s Thyssenkrupp AG, the two sides have hit an impasse over three key sticking points, according to two people familiar with the matter.
Jindal Steel International, the Indian bidder, is seeking clarity on the pension liabilities and retrenchment costs it would inherit with the asset. The company also wants to know how much fiscal support the German government would provide to help fund the transition from blast furnace-based steelmaking to relatively cleaner operations, in line with support extended by other European governments to their domestic steelmakers.
Thyssenkrupp’s Demands
However, Thyssenkrupp first wants Jindal to disclose its post-acquisition investment plans for the asset and explain how it intends to finance them, one of the two people said.
This follows an intensive technical inspection, where executives and consultants from the Indian side made multiple visits to the Duisberg-based steel mill of Thyssenkrupp as well as its downstream facilities across Germany to evaluate the quality of the asset. From the Indian side, the negotiations are being led by Naveen Jindal, his son Venkatesh and Narendra Misra, director of European operations of Jindal.
Impasse in Negotiations
While the technical inspection is complete and negotiations have progressed to financial discussions, neither side wants to make a commitment first, resulting in an impasse over what is effectively a four-way deal between Jindal, Thyssenkrupp, employee unions, and the German government.
Thyssenkrupp executives are increasingly getting doubtful that the deal would fructify, Bloomberg reported on Thursday, citing unnamed sources.
New Suitor Emerges
The impasse comes at a time when US-based investment fund Flacks Group has evinced interest in Thyssenkrupp, increasing competition for the company, Reuters reported earlier this week. Interestingly, the Flacks Group is also negotiating the takeover of Italy’s Acciaierie d’Italia, another major asset for which Jindal had unsuccessfully made an acquisition bid last year.
Expert Insights
“Such pauses are hardly uncommon in cross-border acquisitions of this scale. Each side is, quite naturally, attempting to de-risk the transaction—the buyer seeking clarity on labour and restructuring liabilities, the seller seeking financial commitment to offset its own risks,” said Monish G. Chatrath, managing partner of MGC Global Risk Advisory.
Jindal Steel’s Ambitions
Jindal Steel International made an unsolicited offer to acquire Germany’s largest steel business from Thyssenkrupp AG in September 2025 with an investment commitment of €2 billion (over ₹21,000 crore). The company said its iron ore mines in Cameroon would ensure steady supply of raw materials for Thyssenkrupp. It has also promised investments in additional low-emission steel production in Germany.
The bid was largely seen as part of Jindal’s plan to make a privately-held international steel empire with mines in Africa, green steel units in Oman and a domestic presence in Europe that would give it a foothold in one of the world’s largest steel markets.
Government Support
But before buying Thyssenkrupp’s plant, Jindal wants financial commitment from the German government to fund a restructuring of the plant and move from blast furnace-based production to electric arc furnaces to comply with Europe’s stringent emission standards.
Such fiscal support is not unheard of in Europe. The UK government is giving £500 million to Tata Steel for a similar restructuring of its Port Talbot steel mill. Tata Steel is also negotiating a similar grant with the Netherlands’ government for its Dutch steel plant. The French government has provided €850 million to support ArcelorMittal’s restructuring of its Dunkirk plant, which includes replacing blast furnaces with electric arc furnaces and a DRI plant.
Thyssenkrupp’s Plans
Thyssenkrupp AG, a diverse German industrial conglomerate, has long been looking to sell its loss-making steel unit as part of a restructuring to become a more focussed and profitable company.
However, its desperation to divest the asset has mellowed recently, as sentiment around European steel operations turned positive in recent months, buoyed by import restrictions. Miguel Angel Lopez Borrego, the chief executive of Thyssenkrupp AG, in an earnings call on 12 February said share prices of many steel makers have risen by as much as 50%.
“There is a clear positive sentiment here. And, of course, that will have for sure to get into an input for the conversations with our colleagues from Jindal, no doubt about that,” he had said.
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