Published by Global Banking & Finance Review®
Posted on December 18, 2025
2 min readLast updated: January 20, 2026
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Salzgitter has initiated arbitration against Thyssenkrupp to resolve financial obligations in their HKM joint venture, amid potential restructuring.
FRANKFURT, Dec 18 (Reuters) - Salzgitter has filed an arbitration claim against Thyssenkrupp to determine its future financial obligations with regard to their steel joint venture HKM, a spokesperson for the company said on Thursday.
Thyssenkrupp is trying to streamline its steel business in the face of fierce competition and has previously said it might need to sell or close HKM, a 50-30-20 joint venture between Thyssenkrupp, Salzgitter and Vallourec, which employs around 3,000 staff.
Uncertainty surrounding the future of the joint venture has created tensions among the partners.
Salzgitter CEO Gunnar Groebler told German newspaper WAZ this week that the company may be prepared to continue HKM with an annual capacity of 2-2.5 million tonnes, down from 4.2 million tonnes now, adding that such a plan would bring down staffing to around 1,000.
Groebler said that under certain circumstances Salzgitter could take over all of HKM, and that the joint-venture partners would have to contribute to the costs of downsizing, while Thyssenkrupp would need to provide clarity on purchase volumes for the next 2-3 years.
There also needed to be positive feedback on 200 million euros ($235 million) in subsidies HKM has applied for in relation to a new electric arc furnace, Groebler said.
There is also a state guarantee under discussion with the state of North Rhine-Westphalia, where HKM is based, he added.
The Salzgitter spokesperson did not provide any details of the arbitration claim.
Thyssenkrupp's Thyssenkrupp Steel Europe (TKSE) division in April decided to terminate a supply contract with HKM.
Thyssenkrupp, which is in talks to sell TKSE to India's Jindal Steel International, last week said it had set aside provisions for HKM in the low triple-digit million euro range.
Thyssenkrupp CEO Miguel Lopez at the time declined to comment when asked about whether Salzgitter had filed a claim, only saying that "legal action is certainly not helpful".
($1 = 0.8519 euros)
(Reporting by Christoph Steitz. Editing by Jane Merriman)
A joint venture is a business arrangement where two or more parties agree to pool their resources for a specific task, often involving shared ownership, risks, and profits.
Financial obligations are legal commitments to pay debts or fulfill financial responsibilities, such as loans, contracts, or agreements that require monetary payments.
The steel industry involves the production and processing of steel, a key material used in construction, manufacturing, and various engineering applications.
Investment refers to the allocation of resources, usually money, to generate income or profit over time, often involving the purchase of assets like stocks, bonds, or real estate.
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