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German state premier backs Thyssenkrupp chairman, opposes company's breakup

Reuters/Duesseldorf, Germany 13 Jul 18 | 06:41 AM

Heinrich Hiesinger quit last week after failing to win unanimous board approval for a deal to spin out ThyssenKrupp's steel business into a joint venture with India's Tata Steel Photo: Reuters

The premier of the German state where ThyssenKrupp is based on Thursday backed the company's chairman in opposing a breakup of the industrial conglomerate following the resignation of CEO Heinrich Hiesinger.

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Cevian, ThyssenKrupp's second-largest shareholder with an 18-per cent stake, has demanded a review of all of ThyssenKrupp's business areas, saying each might thrive better in a different set-up. Fellow investor Elliott has also called for a radical overhaul amid broad discontent over strategy.

"We want long-term development, not short-term profits," Armin Laschet, the conservative prime minister of North Rhine-Westphalia, said after meeting managers and labour leaders in state capital Duesseldorf.

Laschet's comments echoed those by Chairman Ulrich Lehner, who was quoted on Wednesday as saying that a break-up of ThyssenKrupp was out of the question.

The Alfried Krupp von Bohlen und Halbach Foundation, the group's biggest investor with a 21 per cent stake, said this would not happen. Laschet, who sits on the foundation's board, urged dialogue.

"We have to get back to basics," he said. "We bear a great responsibility."

The Krupp foundation will meet on Friday and Knut Giesler, the regional leader of the IG Metall industrial union, said it would be vital for it to back a "sustainable" strategy for ThyssenKrupp.

Hiesinger quit last week after failing to win unanimous board approval for a deal to spin out ThyssenKrupp's steel business into a joint venture with India's Tata Steel.

Giesler said he expected a supervisory board subcommittee, which also meets on Friday, to name chief financial officer Guido Kerkhoff as interim CEO until a successor can be found.

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