This Morning in Metals: Thysskenkrupp sells elevator business for €17.2B

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This morning in metals news, German firm Thyssenkrupp announced the sale of its elevator segment, the U.S.’s trade deficit in goods dipped in January and the International Tin Association recently surveyed tin producers regarding the impact of the coronavirus outbreak.

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Thyssenkrupp agrees to sale of elevator business

As we’ve reported here before, Thyssenkrupp, amid a number of challenges, has sought to spin off its profitable elevator segment, with media reports previously indicating interest from rival elevator manufacturer Kone.

This week, however, the German firm announced it is selling its elevator business to a consortium of bidders led by Advent, Cinven and RAG foundation for €17.2 billion.

Thyssenkrupp said it expects to complete the sale by the end of this fiscal year and that it plans to reinvest €1.25 billion of the sale price to purchase a stake in the business.

“With the sale, we are paving the way for thyssenkrupp to become successful,” CEO Martina Merz said. “Not only have we obtained a very good selling price, we will also be able to complete the transaction quickly. It is now crucial for us to find the best possible balance for the use of the funds. We will reduce thyssenkrupp’s debt as far as is necessary and at the same time invest as much as is reasonable in developing the company. With this, thyssenkrupp can pick up speed again.”

U.S. trade deficit falls in January

The U.S. trade deficit in goods hit $65.5 billion in January, down from $68.7 billion the previous month.

The trade deficit in January 2019 reached $72.3 billion.

Tin and the coronavirus

We’ve recently taken a look at the coronavirus outbreak’s impact on a number of metal sectors, including steel, aluminum and copper.

What about tin?

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The International Tin Association recently surveyed tin consumers and producers in China, noting imports from Myanmar were completely blocked.

“Overall, most companies felt that business would return to normal again in March, with little effect on annual tin demand,” the ITA said. 
 
“The same cannot be said for customers further down the supply chain. Major tin-using companies are reporting that many of their customers remain closed. In the automotive sector, CNN and Reuters have reported that high-profile companies, such as Renault and Nissan, have closed production plants across the globe due to their reliance on Chinese parts. In the electronics industry, one estimate placed the employee return-to-work rate at 20%.”

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