Thyssenkrupp’s Summer of Reckoning: Spin-Off, Tariffs, and a Stake Sale Fuel Rally

Thyssenkrupp shares up 56% from low as record Materials Services demerger, EU steel tariff cuts, and HKM exit approach key decisions in coming weeks.

Thyssenkrupp’s stock has clawed back more than half of its losses since the March trough, but the hard part is only just beginning. At €11.73, the shares are up 56% from the 52-week low of €7.15 and have punched through the 200-day moving average. The move has been driven by a trio of fundamental catalysts that will all come to a head over the next several weeks: a record-breaking spin-off, a new wave of EU steel protectionism, and an exit from a joint venture.

The centrepiece of the restructuring is the plan to hive off Materials Services (MX), the group’s metals trading division. With €11.4bn in revenue and more than 15,000 employees, it would be the biggest demerger in Thyssenkrupp’s history. MX alone contributes over a third of the conglomerate’s turnover. Management is weighing a structure as a Kommanditgesellschaft auf Aktien (KGaA), a legal form that would let the parent retain control even after selling down its stake. A supervisory board meeting on 16 June is expected to push the process forward, with an extraordinary general meeting pencilled in for late July or early August. The formal invitation could land as early as June.

The division is already showing its mettle operationally. In the second quarter, Materials Services posted adjusted earnings of €81m, nearly triple the year-ago figure, while revenue rose 5% to €3.19bn. The spin-off — which could happen before the end of this calendar year if market conditions cooperate — follows the successful carve-outs of Nucera in 2023 and Marine Systems in 2025.

Parallel to the internal restructuring, Brussels is throwing Thyssenkrupp a lifeline. The European Parliament has approved a new steel tariff regulation that will slash duty-free import quotas to 18.3m tonnes from 1 July — a 47% reduction versus 2024. Shipments exceeding that cap will face a 50% levy, double the current rate. The Council’s rubber-stamp is a formality, as the trilogue has already agreed the terms. For Thyssenkrupp’s beleaguered steel unit, the measures should stem the flow of cheap foreign material. A notable gap remains: electrical steel is not yet covered. The group has asked the European Commission to open a separate safeguard investigation, and the Commission has obliged.

Another piece of the portfolio puzzle is falling into place. Talks with Salzgitter over Thyssenkrupp’s stake in HKM, the jointly owned steel mill, are expected to conclude in June. A full takeover by Salzgitter is the likely outcome, allowing Thyssenkrupp to further streamline its steel operations after earlier negotiations with India’s Jindal Steel collapsed. That leaves the steel division Steel Europe as the group’s biggest headache, still searching for a lasting solution. Equity in the division stood at €10.3bn, unchanged from the prior quarter.

While the management reshuffles the balance sheet, one of the world’s largest sovereign funds has been trimming its exposure. Norway’s Norges Bank dipped below the 3% voting-rights threshold, a move the fund crossed only in February. The reduction appears to be a routine portfolio rebalancing, not a strategic verdict on the stock.

The operational snapshot from the second quarter underscores the improvement across the group. Order intake surged 32% to €10.6bn. Adjusted EBIT rebounded to €198m from just €19m a year earlier, supported by strong marine systems orders, including an extension of the 212CD submarine programme for Norway. Revenue landed at €8.4bn, a tad below the prior-year level. The group’s full-year guidance through September 2026 remains cautious: adjusted EBIT of up to €900m, but a negative free cash flow of as much as €600m. The revenue forecast was trimmed to show a decline of between 3% and zero.

On the technical side, the stock is clearly in an uptrend but not yet stretched. The relative strength index sits at 62.2, leaving room for further gains before the overbought zone. The 52-week high of €13.24 is still 11% above the current level. The question hovering over the market is whether the regulatory and structural catalysts are powerful enough to sustain the rally — or whether the summer will bring a pause for breath. The decisions made in June will provide the answer.