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Germany's ThyssenKrupp appoints Indian-origin CEO

PTI | London | Updated: 14-06-2019 20:43 IST | Created: 14-06-2019 20:40 IST
Germany's ThyssenKrupp appoints Indian-origin CEO
Image Credit: ANI

ThyssenKrupp on Friday announced the appointment of Premal Desai as the new Chief Executive Officer (CEO) for its steel division to oversee the restructuring of its business following the collapse of a proposed joint venture with Indian steel major, Tata Steel, in Europe. ThyssenKrupp Steel Europe and Tata Steel Europe had signed agreements on June 30, 2018, to create a 50:50 joint venture. However, the European Commission had raised concerns over high prices for electrical steel, automotive steel and packaging among others in the event of the merger going ahead.

In May 2019, the two companies announced they were scrapping the plan. The 50-year-old Indian-origin executive, who has been Chief Financial Officer (CFO) of ThyssenKrupp Steel Europe AG since 2015, will take charge as the Chairman of the Executive Board of the company.

As a former Head of Strategy at ThyssenKrupp AG, Desai will now be in charge of formulating a "sustainable strategy" for the steel division. "Shaping the future of steel is a challenging task. There's a lot to do," said Desai.

"We look forward to tackling this together as a management team. The market environment is not easy, but we are in a strong position and have a lot of potentials. We'll build on that," he said. Further down the line, Desai is also set to take over the strategy and planning function as well as the financial function and will lead the Management Board of ThyssenKrupp Steel Europe AG.

The German steel major said Andreas Goss will resign from his position as CEO by "mutual agreement" in view of the cancellation of the proposed joint venture with the Indian steel giant Tata, indicating that the changes have been necessitated as a result of the European Union's decision to block the JV over fears that it would have led to increased prices for different types of steel in Europe. "Our steel business is facing major challenges. We have now put together a strong team that will tackle the tasks at hand quickly and develop a sustainable strategy for steel following the cancellation of the joint venture," said Guido Kerkhoff, CEO of ThyssenKrupp AG.

Amid the major changes at the top rung of the company, Heribert Fischer will also leave the Steel Board but remain with ThyssenKrupp Steel Europe AG in an advisory capacity at the request of the company. Bernhard Osburg, currently responsible for sales management in the steel segment, will join the Executive Board of ThyssenKrupp Steel Europe AG as Chief Commercial Officer and will be responsible for all sales and innovation activities in the steel business.

Steel producers in Europe have been hit by falling demand in the past few months, with both ThyssenKrupp and Tata Steel indicating shifts in strategy for their European operations. The two companies had hoped to create the second-largest European steel entity behind Lakshmi N Mittal's ArcelorMittal with a merger, but the European Commission rejected the plans after an in-depth investigation concluded that the companies had failed to offer "adequate remedies" to ensure their proposed JV would not reduce competition and increase prices.



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