Outokumpu Oyj, a Finnish maker of stainless steel, fell close to a record low in Helsinki trading as Deutsche Bank AG said the company may be forced to sell assets or issue new shares to boost its balance sheet.
Outokumpu fell as much as 4.5 percent to 50.5 euro cents, and declined 4 percent at 2:12 p.m. in the Finnish capital, nearing the record low of 49.7 euro cents reached on April 8. It was the biggest drop on the Nasdaq OMX Helsinki 25 index. Trading volume was about 40 percent of the three-month daily average.
Outokumpu completed the purchase of ThyssenKrupp AG’s Inoxum stainless-steel unit in December and agreed to divest its Italian Terni mill to remedy the European Commission’s competition concerns in the 2.7 billion-euro ($3.5 billion) deal. Terni has attracted interest from a venture lead by Aperam SA. Outokumpu has said it’s in talks with “several” potential buyers and expects to close the sale this quarter.
“We believe further divestments of ‘crown jewels’ and a possible rights issue will be required,” Deutsche Bank said in a note today, reiterating its sell recommendation on the stock. “We expect management to look into options once the Terni disposal finishes.”