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UPDATE 2-Steel unit boosts Thyssenkrupp profit ahead of Tata Steel tie-up

From Reuters - February 13, 2018

FRANKFURT (Reuters) - German industrial and technology group Thyssenkrupp said on Wednesday first-quarter operating profit rose by more than a third, boosted by a recovery at its steel unit, which is to be merged with Tata Steels European operations.

Operating profit at Thyssenkrupps Steel Europe division rose nearly sixfold to 160 million euros ($198 million) due to improved prices that also led Tata Steel and market leader ArcelorMittal to post strong results in recent weeks.

In a bid to tackle excess capacity which it said remained a problem in the volatile sector, Thyssenkrupp agreed in September to combine its European steel unit with that of Indias Tata Steel to create the continents No.2 player.

The market environment remains extremely challenging structurally, with continuing global overcapacities, risks from trade imbalances and highly volatile raw material prices, Thyssenkrupp said in its quarterly report.

Thyssenkrupp said it still expected the signing of the joint venture contract in early 2018, marking the biggest step so far in Chief Executive Heinrich Hiesingers efforts to shift the groups focus towards technology and away from steel.

Most famous for its steel business, which has roots going back more than 200 years, Thyssenkrupp is active in several industrial fields and makes everything from elevators and submarines to car parts and chemical plants.

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