London: The European Union on Tuesday launched an “in-depth investigation” to assess if Tata Steel’s proposed joint venture with German steel giant ThyssenKrupp would breach the bloc’s merger regulations and reduce competition.
Tata Steel and ThyssenKrupp are major integrated producers of flat carbon steel and electrical steel, with significant production facilities in the European Economic Area (EEA), in particular in Germany, the Netherlands and the UK.
In June, Tata Steel had confirmed that it has agreed the terms of a 50-50 joint venture with ThyssenKrupp to create Europe’s second-largest steel company after Lakshmi Mittal’s ArcelorMittal. “The European Commission has opened an in-depth investigation to assess the proposed creation of a joint venture by Tata Steel and ThyssenKrupp,” the European Commission, the executive arm of the 28-member economic bloc, said.
At this stage, the Commission said it is concerned that the merger between the two steel majors may reduce competition in the supply of various high-end steels.”Steel is a crucial input for many of the goods we use in our everyday life, and competitive steel prices are vital for the European economy,” said Margrethe Vestager, Commissioner in charge of the EU’s competition policy.
