ThyssenKrupp AG (TKA)’s largest shareholder lost its blocking minority as the German steelmaker’s capital increase diluted the shares.
The Alfried Krupp von Bohlen und Halbach Foundation didn’t participate in the stock sale this week, the organization said today in a statement. Its holding shrank to about 23 percent from 25.3 percent, according to data compiled by Bloomberg.
The foundation has held sway over the steelmaker for decades, enjoying veto power over major decisions. Its influence may wane with the loss of a seat on the supervisory board, where it previously nominated three of the 20 members. The change in its holding comes as ThyssenKrupp seeks renewal after a botched expansion in the Americas and corruption scandals erased profit.
Germany’s largest steelmaker raised 882.3 million euros ($1.2 billion) in the stock sale, increasing capital by 10 percent of its market value, the Essen-based company said today. That followed an agreement last week to sell a U.S. steel plant for $1.55 billion as it pulls back from its Americas division.
The Krupp foundation’s decision not to participate in the capital increase shows that it “isn’t funded so opulently” after ThyssenKrupp scrapped dividends last year, Marc Gabriel, an analyst at Bankhaus Lampe KG, said by phone.
ThyssenKrupp’s equity ratio, a measure of the relative share of equity used to finance its assets, sank to 7.1 percent as of Sept. 30 from 11.8 percent a year earlier. The company, whose Americas unit helped wipe 14 billion euros off its market value since 2008, has spent 18 months trying to sell plants in Alabama and Brazil.
The Krupp foundation’s loss of a blocking minority won’t necessarily shut it out of decision-making, according to Hans-Peter Wodniok, an analyst at Fairesearch GmbH & Co.
“It’s possible that the foundation with its holding may continue to be able to block any important decision at the annual general meeting” because representation is usually less than 100 percent, Wodniok said by phone from Kronberg.
ThyssenKrupp fell 2.2 percent to 17.255 euros in Frankfurt, the lowest closing price in more than two months. Trading volumes were six times the three-month daily average.
The steelmaker, whose shares have dropped more than 50 percent since mid-2011, is seeking to curb debt and bolster its balance sheet following a slump in global steel demand. The company said Nov. 29 it will sell its U.S. steel plant to ArcelorMittal and Nippon Steel & Sumitomo Metal Corp.
Cevian Capital AB, ThyssenKrupp’s second-biggest shareholder, declined to comment on whether it participated in the stock sale. Cevian’s stake rose to more than 10 percent, Reuters reported today, citing people it didn’t identify.
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