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Profit warning exposes takeover risk for Thyssenkrupp

14:20 10-11-2018
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 A fresh hit to Thyssenkrupp <TKAG.DE> shares has driven down the group's enterprise value, raising the chances of a full takeover bid, two people familiar with the matter said, a move that could derail a plan to split the group in two, Euronews reports.

The German conglomerate cut its profit forecast late on Thursday, sending its shares tumbling 12.2 percent to 16.7 euros apiece on Friday, their biggest intraday fall since June 2016.

The group's enterprise value, a key gauge for potential suitors, fell to 14.3 billion euros ($16 billion), according to Refinitiv data.

That is below the standalone value of its elevators division - of around 15 billion euros, according to analysts - the most valuable part of the group, which had appeared untouched by issues afflicting other units.

"The value of the group is reaching a level that could expose it to interest from private equity consortia," one of the sources said. "This does not bode well for the group's current restructuring move."

The profit warning by Chief Executive Guido Kerkhoff, his second since being confirmed in the job on Sept. 30, undermines his efforts to retain control over the company's strategy of keeping the automotive and elevators divisions separate from steel and materials.

Kerkhoff ousted the head of the elevators division this week in an attempt to tighten his grip on the company, sources familiar with the matter said.