Thyssenkrupp plans IPO of shipbuilding division within a year

German group Thyssenkrupp AG plans to launch an initial public offering (IPO) of its shipbuilding division within a year, after plans to sell a majority stake in it to private equity firm Carlyle Group Inc. fell through, according to the division's chief executive, Bloomberg reported, citing the Welt am Sonntag newspaper.

"We continue to want the independence of Thyssenkrupp Marine Systems (TKMS)," Oliver Burkhard, the division's chief executive, said in an interview with Welt am Sonntag, adding: "That means we prefer a spin-off, a separation of TKMS through an IPO. But since a public offering requires more preparation than a share sale, the IPO could take place at the end of 2025 or the beginning of 2026."

The shipbuilding division announced in October that Carlyle had abandoned a process to acquire a majority stake in it. In this context, the Italian company Fincantieri SpA informed, at the end of October, that it is open to creating closer ties with TKMS. The German government has evaluated the possibility of buying a 50% stake in the division or even taking it over entirely, according to Manager Magazin.

Burkhard said, quoted by Welt am Sonntag, that he also wants the German government as an investor in TKMS, a move that could be combined with a spin-off. The governments of France, Spain, Italy and the Nordic countries have holdings in shipbuilders. "Such a shareholding would also make sense in Germany," Burkhard stressed.

The shipbuilding division remains open to offers or partnerships with investors, even if it prefers a spin-off, Burkhard added, given that there is interest from all relevant market participants.

Thyssenkrupp expects to turn a profit in the current fiscal year, especially as its turnaround plan that includes restructuring its troubled steel division is making progress, Bloomberg notes.

The German company expects a net profit of at least 100 million euros ($106 million) in the year ending in September 2025, compared with a net loss of 1.4 billion euros in the period just ended. The company also estimates an increase in operating profits, even though the cash will be used for large investments and restructuring. Thyssenkrupp is spending heavily to restructure its troubled steel division.

"The current fiscal year is a transition year on our path to achieving our medium-term financial goals, even in a challenging environment," said Thyssenkrupp Chief Executive Miguel Lopez.

In April, Thyssenkrupp announced it would reduce its steel production capacity by about a fifth, along with substantial job cuts for the division's 26,000 workers.