How do you say "giant engineering and steel company" in German? Try ThyssenKrupp and pronounce it "TISS-in kroop." The company is one of the world's largest steel producers and operates worldwide in two business areas: Materials and Technologies. The first comprises the company's steel (carbon and stainless steel) and materials services businesses. ThyssenKrupp's Technologies group consists of its elevators unit, marine systems, components technology (for the auto and engineering markets), and plant technology (construction and environmental services) segments. Although its combined interests range from elevators to shipbuilding, the company has historically relied upon the steel market.
ThyssenKrupp's diversified industrial operations are split into seven operating business areas, plus Inoxum (formerly Stainless Global) as a discontinued operation. The Materials division consists of the Steel Europe, Steel Americas, and Materials Services units. The Technologies division comprises the company's Elevator Technology, Plant Technology, Components Technology, and Marine Systems units.
In 2011 ThyssenKrupp's revenues increased 15% from the previous year (for both continuing operations and before Stainless Global carve-out sales figures). Although growth continued to be weak in Europe and the US during 2011, the German economy was positive, and the group's rise in orders and sales increased in most business areas. That year the company received strong demand for its flat carbon steel, auto components, and naval shipbuilding operations. Five business areas increased earnings from the previous year, with Steel Europe being the largest contributor. The company's net loss of €1.8 billion ($2.3 billion) in 2011, compared with a net income of €927 million ($1.2 billion) in 2010, resulted from impairment charges for the discontinued operations of its Stainless Global business and its Steel Americas unit (from cost overruns in the build of its plant in Brazil and the weakness of markets in the US and Europe).
To pay down debt, the company decided in 2011 to divest €10 billion ($14.4 billion) worth of noncore assets. Stainless Global, its stainless steel business, was the largest asset on the chopping block. At 3 million tons a year, Stainless Global was Europe's largest stainless steel producer. ThyssenKrupp followed in the footsteps of rival ArcelorMittal, which spun off its stainless unit into a new company, Aperam, earlier in 2011.
ThyssenKrupp split off Stainless Global from its other operations and renamed it Inoxum. Inoxum's operations include the manufacture of stainless steel flat products and materials such as nickel alloys, titanium, and zirconium. Early in 2012 ThyssenKrupp agreed to sell Inoxum to Finnish company Outokumpu for €2.7 billion ($3.54 billion). The deal awaits approval by the European Commission after Outokumpu divests some of its combined operations with Inoxum.
In 2012 the company also offloaded ThyssenKrupp Steel Europe's lightweight steel construction elements group to Irish company Kingspan.
ThyssenKrupp sold its metal forming unit, which supplies the automotive industry, to Spain's Gestamp Automocion in 2011. The metals unit was no longer part of ThyssenKrupp's core business of Steel Europe. In another move to unload noncore businesses and pay down debt that year, ThyssenKrupp sold Xervon, a service provider for the processing, construction, and energy and power industries, to German water and recycling services company Remondis.
In another exit that year, ThyssenKrupp terminated its submarine sales joint venture with Ferrostaal, which is owned by Germany's MAN group and Abu Dhabi's International Petroleum Investment Co. (IPIC). The company is reorganizing its Marine Systems business unit.
While continuing to divest noncore operations, the group is making selective investments in key growth areas. It is making major investments in projects in Brazil and the US. Its Elevator Technology has made strategic acquisitions in the US and Canada, as well as smaller buys in the Benelux countries, France, Italy, and Spain. The Plant Technology unit has expanded its coke plant activities by acquiring Tokyo-based Otto Corporation. Through its Components Technology unit, ThyssenKrupp has invested in crankshaft factories in Nanjing, China.
ThyssenKrupp is a product of the 1999 merger of Thyssen AG and Fried. Krupp AG Hoesch-Krupp. The Alfried Krupp von Bohlen und Halbach Foundation owns 25% of the company.