Klöckner & Co: US Tariff Tailwind Meets High-Stakes May Showdown

Goldman Sachs builds 9.48% stake in Klöckner & Co, betting on a higher exit price as Worthington Steel pushes for a domination agreement and delisting.

Goldman Sachs has emerged as a heavyweight in Klöckner & Co’s takeover saga, building a 9.48 percent stake that signals a clear bet on a richer exit for minority shareholders. The investment bank’s positioning comes as the stock trades at €12.56 — roughly 14 percent above Worthington Steel’s original offer of €11.00 per share — reflecting market expectations that a domination and profit transfer agreement (DPTA) will force a higher valuation.

The US steel group already controls 58.8 percent of voting rights, enough for a majority but short of the 90 percent threshold needed for a squeeze-out. Should Worthington clear that bar, it plans to push remaining minority holders out and then pursue a delisting from the Frankfurt Stock Exchange. Regulatory approvals are expected in the second half of 2026.

Tariff Quirk Gives Klöckner an Edge

While European steel producers struggle under US import tariffs, Klöckner benefits from a structural advantage. The company buys and sells locally in the US, meaning the 25 percent levies on steel and aluminum largely pass it by. Roughly half of its revenue comes from the American market.

The mechanics are straightforward: Klöckner holds US inventory acquired at lower prices and can now sell it at elevated market rates. Management therefore expects rising profits in the second and third quarters of 2026. For the full year, the board forecasts a significantly higher EBITDA and growing cash flow — this despite the sale of eight US distribution sites to Russel Metals at the end of 2025.

The company’s turnaround is gaining traction. The net loss narrowed to €53 million in 2025 from €176 million the prior year, while adjusted EBITDA climbed a quarter to €171 million. Operating cash flow turned positive for the fourth consecutive period. The share of high-margin service center business — excluding the divested sites — now stands at 87 percent, a key milestone in the restructuring.

Three Dates That Could Reshape the Stock

May brings a trio of pivotal events. On May 6, Klöckner publishes its Q1 2026 trading statement — the first operational report under Worthington’s majority ownership. The company has guided for EBITDA before special items between €20 million and €60 million, an unusually wide range that underscores limited visibility in the current environment.

The Equity Forum Spring Conference in Frankfurt follows on May 11. Then, on May 20, the annual general meeting in Düsseldorf will vote on a proposed dividend of €0.20 per share. But the real drama centers on Worthington’s push for a DPTA at that same meeting. With roughly 62 percent of shares, the US group appears to have the qualified majority needed to push it through.

A DPTA carries concrete consequences: it obligates the majority owner to commission an independent company valuation, which then determines a mandatory compensation payment and an annual guaranteed dividend for remaining minority holders. For those investors, that valuation is the critical number.

Squeeze-Out Looms as Next Act

If Worthington’s stake reaches 90 percent, the squeeze-out and delisting process can begin. The market is already pricing in that scenario — Klöckner shares have surged roughly 53 percent since the start of the year. Whether that premium over the original offer is justified depends entirely on the independent valuation that will emerge from the DPTA process, clarity on which won’t come until regulatory clearance in the second half of 2026.

The May events will test whether the current share price premium reflects genuine value or market overexuberance. For now, Goldman Sachs’ hefty position suggests at least one major player expects the math to work in minority holders’ favor.