Thyssenkrupp to Raise Capital by 10%
German industrial company Thyssenkrupp AG (TKA.XE) said Monday it would increase its share capital by 10%, a move that could raise as much as EUR1.4 billion (about $1.67 billion) in proceeds.
Thyssenkrupp plans to issue 56.6 million new shares in the increase, with the placement price and proceeds to be announced after an accelerated bookbuilding. Based on Monday's closing price of EUR24.70 per share, the capital increase would raise about EUR1.4 billion.
The decision follows recent strategic decisions, including the sale of the company's Brazilian steel mill, completed earlier this month, Thyssenkrupp said. Last week, the company also announced plans to merge its European steel operations with those of Tata Steel Ltd. (500470.BY), a move aimed at improving the company's balance sheet ratios.
"The capital increase now announced provides the group with the financial leeway to support organic growth in its industrial goods businesses in the focus areas of urbanization, mobility and services while driving forward necessary restructuring initiatives at a faster rate," Thyssenkrupp said.
Chief Executive Heinrich Hiesinger said the Tata deal gives the German company more strategic clarity, but said it would take time for the positive effects to feed through to the balance sheet.
"We will use that time to strengthen our industrial goods businesses right away," he said.
The bookbuilding starts Monday, Thyssenkrupp said.
Write to Sarah Sloat at email@example.com
(END) Dow Jones Newswires
September 25, 2017 13:44 ET (17:44 GMT)