October 1, 2018 / 3:00 PM / 19 days ago

Factbox: Thyssenkrupp breaks into two

(Reuters) - Thyssenkrupp last week unveiled plans to spin off its capital goods business into a separately-listed entity, effectively splitting the conglomerate in two.

FILE PHOTO: A logo of ThyssenKrupp AG is pictured outside the ThyssenKrupp headquarters in Essen, November 23, 2017. REUTERS/Thilo Schmuelgen/File Photo

The split will lead to a negative tax effect of about 1 billion euros ($1.2 billion), the group said. It still requires shareholder approval, which is expected by March 2019.

Below are key facts relating to the two planned companies, to be called Thyssenkrupp Materials and Thyssenkrupp Industrials:

THYSSENKRUPP INDUSTRIALS

The new spin-off company will consist of:

- Elevator Technology, Thyssenkrupp’s most profitable and valuable business

- Components Technology, which supplies the automotive industry, although the division’s Bearings and Forged Technologies units will move to Thyssenkrupp Materials

- Industrial Solutions, Thyssenkrupp’s plant engineering business. However, its System Engineering unit, which builds production lines for cars, will be made a part of Components Technology

- Based on pro-forma figures for 2016/17, Thyssenkrupp Industrials would generate sales of about 16 billion euros and operating profit of 1.2 billion euros and have about 90,000 employees

- It aims for an investment grade credit rating and will have debt of about 1.6 billion euros

- Existing shareholders of Thyssenkrupp will initially own a majority of Thyssenkrupp Industrials, while Thyssenkrupp Materials will hold the rest

THYSSENKRUPP MATERIALS

- Based on pro-forma figures for 2016/17, Thyssenkrupp Materials would generate sales of about 18 billion euros and operating profit of 550 million euros and have nearly 40,000 employees

- Its debt will stand at about 2.6 billion euros

- It might have a BB credit rating, the same as Thyssenkrupp AG’s current rating

- Existing shareholders of Thyssenkrupp will continue to own 100 percent of Thyssenkrupp Materials

- Thyssenkrupp Materials will sell its minority stake in Thyssenkrupp Industrials after the split

- This company will comprise Materials Services, Thyssenkrupp’s largest division by sales, which is active in the trading of steel and other materials and includes stainless steel unit Acciai Speciali Terni (AST)

- It will also own the 50 percent stake in a planned European steel joint venture with Tata Steel announced earlier this year

- Marine Systems, Thyssenkrupp’s struggling shipbuilding division will also be a part of this business, as will the company’s slewing bearings and forging operations

($1 = 0.8621 euros)

Reporting by Christoph Steitz in Frankfurt; Editing by Mark Potter and David Goodman

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