The European headquarters of the Indian steel giant Tata Steel is trying to sell some profitable business units based in the Netherlands. With this, the group aims to address previous objections from the European Union regarding potential market disruption following a possible merger with the German steel company ThyssenKrupp, reports the Independent European Daily Express.
The merger of the Indian and German steel giants was suspended last year because the European Commission did not (yet) agree, fearing the loss of 'healthy competition.' Initially, it was expected that Tata Steel would respond by closing some loss-making British steel plants and making some small Spanish and French factories independent.
However, staff and management of Tata Netherlands have not been formally informed about these new sales plans. The employees of one of the threatened locations are filing a lawsuit against the parent company to gain clarity. The Dutch business units in question are profitable, while the greatest losses are being incurred in the United Kingdom.
The units Tata Steel Europe wants to sell include SAB Profiel, with sites in IJsselstein, Nieuwegein, and Geldermalsen. Tata Steel Tubes is also up for sale; this involves locations in Oosterhout, Maastricht, and Zwijndrecht.
The sales activities follow an earlier reorganization plan by Tata Steel, which involved cutting around 1,600 jobs at Tata Steel Netherlands, including at the profitable steel foundry Hoogovens in IJmuiden. Such mass layoffs will at least be avoided until October 2021, as the company claims it wants to adhere to previously made agreements with the Dutch labor unions about job retention.
According to the unions, selling profitable and strategic units is a bad plan. The union says analysis and vision are missing. The management of Tata Netherlands does state that measures are needed in the current weak steel market to keep the Dutch branch of Tata Steel profitable.