Together with EP Corporate Group a.s. (EPCG), thyssenkrupp AG has agreed on EPCG's participation in thyssenkrupp's steel business. EPCG is acquiring 20 percent of the shares in thyssenkrupp's steel business. The parties have agreed not to disclose the terms of the transaction.
The transaction is planned to close in the current financial year of thyssenkrupp AG, subject to possible approval from the responsible authorities and the Supervisory Board of thyssenkrupp AG. In addition, the parties are discussing the acquisition of a further 30 percent of the shares in the steel business by EPCG. The aim is to form an equal 50/50 joint venture.
Partnership with future concept
The strategic partnership with EPCG, a leading European energy company, is a significant step towards ensuring resilient, cost-efficient and climate-friendly steel production from thyssenkrupp Steel - and thus also a significant contribution to securing the steel industry in Germany. The entry of EPCG combines the leading materials know-how of thyssenkrupp Steel Europe with the energy expertise of EPCG.
“Our goal is a future concept that leads to economic independence and entrepreneurial success for thyssenkrupp Steel, meets the requirements of climate protection, avoids redundancies for operational reasons and finds broad acceptance. The cooperation with the EPCG Group illustrates the confidence of both partners in the successful future of our steel division,” explains Miguel López, CEO of thyssenkrupp AG.
EPCG is deliberately acquiring 20 percent of the steel division at this time and under the current market conditions in order to actively participate in the design and realignment of thyssenkrupp Steel.
“Together we want to create a high-performance, profitable and future-oriented steel company that reduces the costs of decarbonization to a more competitive level and thus accelerates the green transformation of the steel industry towards carbon neutrality. A strong energy partner like the EP Corporate Group is essential for this,” emphasizes López.
“The agreement to acquire the 20 percent stake in thyssenkrupp Steel Europe is a first step on the planned path to a more comprehensive strategic partnership. EPCG has successfully navigated the recent dynamic market conditions in the energy sector, is financially strong, growing and is a reliable provider of energy and services to our customers. On this basis, we are convinced that the joint venture concept with thyssenkrupp Steel will ensure a more resilient position. The entire European steel sector will undergo a similar transformation as the energy sector. We pay respect to thyssenkrupp Steel, a traditional pillar of the German economy, and are honored to join forces in the groundbreaking transformation process to shape a sustainable future. Together we will make an important contribution to the decarbonization of the steel industry,” said Daniel Křetínský, CEO and majority owner of EP Corporate Group.
Advancing decarbonization
thyssenkrupp has already started decarbonizing steel production. In March of this year, work began on the construction of the first hydrogen-capable direct reduction plant with two melters at the Duisburg site. thyssenkrupp Steel Europe is investing around three billion euros to build the plant. The federal government and the state of North Rhine-Westphalia are supporting this overall investment in the project with around two billion euros. The project is considered a blueprint for the decarbonization of industry and a driver of the European hydrogen economy. Due to the government-funded switch to hydrogen as the primary energy source for steel production, the need for green electricity will increase significantly in the coming years. Around ten terawatt hours (TWh) of green electricity are required annually for the hydrogen operation of the first direct reduction plant alone.
The reliable procurement of sufficient quantities of green electricity at competitive conditions is critical to the success of the transformation of the steel industry. While the share of energy costs for producing a slab of crude steel was previously around ten percent of the total costs, with CO2-neutral, hydrogen-based processes it will be up to 50 percent in the future.
EPCG
As a strategic partner of thyssenkrupp Steel, EPCG will contribute its expertise to ensure a sufficient supply of energy in the form of hydrogen, green electricity and the provision of other energy raw materials. EPCG, which is active in nine European markets, brings extensive industry knowledge as an energy trader, supplier and supplier. In 2023, EPCG's energy assets collectively generated 72.5 terawatt hours (TWh) of net electricity. This makes EPCG one of the leading energy producers in Europe. EPCG currently has a generation capacity of around 22 gigawatts (GW) of installed net power in Europe and thus contributes significantly to the reliability of Europe's energy supply.
At the same time, EPCG is taking significant steps in the field of renewable energy. In Germany alone, the company wants to expand its renewable energy generation capacity with more than eight gigawatts of installed capacity by 2030. The focus is on the areas of wind, solar and biomass. For example, EPCG has already started building Germany's largest floating solar system on the Cottbus Baltic Sea in Lusatia.
If required, additional quantities of green electricity, hydrogen and initially also natural gas could be made available to steel production in Duisburg via EPCG's energy trading. There are also useful interfaces for both companies in project management and the implementation of large-scale green transformation projects. In Germany, EPCG operates and develops large energy storage solutions as well as hydrogen-powered gas power plants to cushion peak loads or to maintain security of supply in the event of fluctuating electricity production from wind and solar energy.
