Exclusive: Thyssenkrupp opens books in sale of plant-building unit
By Christoph Steitz and Tom Käckenhoff
ESSEN, Germany (Reuters) - Thyssenkrupp has begun due diligence with potential bidders for its plant area as the German conglomerate accelerates a radical overhaul to sell or reverse troubled businesses over the next two years, a top executive told Reuters .
In his first interview, Volkmar Dinstuhl, who oversees the sale of non-core assets, said the company had opened the books to buyers of its plant units and had received expressions of interest in its stainless steel division.
Thyssenkrupp <TKAG.DE> is also open to offers for its automotive and remaining industrial facilities, said Dinstuhl, who heads the multi-tracks division of the group, where companies are based that Thyssenkrupp no longer wants to own.
"Our goal is to find a solution for all of our business areas within the next two years," said Dinstuhl when Thyssenkrupp first presented a schedule for the restructuring.
The Essen-based company, which manufactures submarines, warships, steel and auto parts, and equipment for cement factories, construction and fertilizer plants, is struggling to define its core business.
Dinstuhl, an international chess master, is taking an opportunistic approach to reshaping the company's portfolio after selling the company's elevator unit earlier this year for € 17.2 billion.
This sale gives Thyssenkrupp the financial strength to contain potential write-downs on other assets for sale, so that a deeper restructuring than previously possible is possible.
Dinstuhl said that Multi-Tracks, which generates sales of around 6 billion euros and was responsible for a negative cash flow of 400 million euros in fiscal year 2018/19, will try to sell, close or find partners the 10 units .
"We're basically an in-house private equity fund," he said.
Jennifer Cooper, who has held various M&A positions at Thyssenkrupp since 2001, will succeed Dinstuhl as head of the mergers and acquisitions group, according to an internal memo from Reuters on Friday.
Thyssenkrupp is partnering with Citi <C.N> to sell Plant Technology, which comprises more than half of Multi Tracks' 20,000 employees and which is expected to receive final offers from a handful of applicants.
"We are keeping all options open, including selling all or part of it," said Dinstuhl. Plant Technology covers the mining, cement and construction industries and competes with the Swedish company Sandvik <SAND.ST> and the Danish company FlSmidth <FLS.CO>.
Dinstuhl said the group had also received letters of interest in its Italian stainless steel unit AST, a sales process conducted with the help of JP Morgan <JPM.N>.
Deutsche Bank said AST, Europe's No. 4 stainless steel manufacturer after Outokumpu <OUT1V.HE> in Finland, Aperam <APAM.AS> based in Luxembourg, and Acerinox <ACX.MC> in Spain, could achieve EUR 300 to 600 million and deduct interest Italian colleagues and private equity firms.
Dinstuhl said M&A activity was brisk and that the first transactions in the current fiscal year were possible by September.
At the same time, he is striving for operational improvements with Multi-Tracks: "We see a stabilization of the business and are optimistic that we have passed the low point," said Dinstuhl.
($ 1 = 0.8497 euros)
(Editing by Edward Taylor, Kirsten Donovan and Susan Fenton)
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