Thyssenkrupp Lines Up HKM Sale and EU Tariff Relief as French Steel Plant Goes Dark

Thyssenkrupp faces June deadlines for HKM stake sale, EU steel safeguard vote, and temporary closure of French electrical steel plant amid Asian import surge. Half-year EBIT surged but revenue slipped.

Thyssenkrupp’s turnaround is about to be tested on multiple fronts within a matter of weeks. The conglomerate is juggling a binding deadline for the sale of its HKM stake, a fresh regulatory shield from Brussels, and the temporary shutdown of a key French electrical steel facility — all while its shares trade near overbought territory.

The most immediate operational headache sits in Isbergues, northern France. Thyssenkrupp Electrical Steel, one of only two remaining European producers of grain-oriented electrical steel used in transformers and wind turbines, will halt production from June through September. The reason: Asian imports have flooded the EU market, now accounting for more than half of demand, with prices often well below European production costs. Imports have tripled since 2022, according to the company. Around 600 employees are affected.

Help may come from Brussels. The European Parliament approved tougher steel safeguard measures in mid-May, slashing duty-free import quotas to 18.3 million tonnes per year — roughly 47% below current levels. Imports exceeding that cap will face a penalty tariff of 50%, double the previous rate. The rules still require ratification by EU member states, a vote that could push the effective date to July 1.

That timeline overlaps neatly with another milestone. Thyssenkrupp is aiming to close the sale of its HKM steel joint-venture stake to Salzgitter by June 1. The deal, which follows the collapse of talks with India’s Jindal Steel, is designed to reduce excess capacity and improve competitiveness in the steel division. CEO Miguel López has framed it as a critical credibility test for the broader holding restructuring.

The company’s half-year results offer some ammunition for the bull case. Adjusted EBIT surged from €19 million to €198 million, easily beating analyst expectations. Revenue, however, slipped 2% to just under €8.4 billion, and the outlook for the full 2025/26 financial year sees revenues declining by as much as 3% or stagnating. Management targets adjusted EBIT of €500 million to €900 million, but restructuring costs will push the net result into a loss of €400 million to €800 million.

On the automotive side, Thyssenkrupp is cutting deeper. The Presta plant in Terre Haute, Indiana, will close by the end of March 2027, eliminating 230 jobs. Chassis-component production will shift entirely to Hamilton, Ohio. The goal is to streamline the division and eventually make it capital-markets ready. North America remains a vital market, generating around €2.1 billion in annual sales.

Elsewhere in the portfolio, the planned sale of TK Elevator to Finland’s Kone is gaining visibility. Thyssenkrupp still holds a 16.2% stake in the elevator business, valued by JPMorgan at roughly €3.27 billion — split into €800 million in cash and Kone shares worth €2.5 billion. The transaction, which values the former Thyssenkrupp unit at €29.4 billion including debt, is not expected to close before the second quarter of 2027.

The naval arm TKMS provides a counterweight to the steel and auto challenges. Order intake jumped nearly a third to €10.6 billion, driven by large military contracts. Canada is also expected to decide between May and June on a submarine order worth more than $10 billion, with TKMS among the bidders.

Investor sentiment has turned sharply optimistic. The stock closed at €10.85 on Friday, up 1.36% on the day and 22.68% over the past 30 days. Yet the relative strength index sits at 87.4, a classic overbought reading that warns of a potential pullback. Analyst opinions diverge: Citigroup’s Ephrem Ravi raised his price target to €15 from €13, betting on the Materials Services demerger, monetisation of the elevator stake, and a steel market recovery. JPMorgan remains more cautious with an €11.80 target and a Neutral rating, flagging execution speed as the key variable.

The next hard catalyst is the formal approval by EU member states of the new steel tariff regime, expected before the end of June. If the HKM deal closes on schedule and Brussels delivers the promised trade barrier, Thyssenkrupp will have two concrete wins to show investors. Any delay on either front, however, could quickly puncture the rally.