Salzgitter AG will become the sole owner of its subsidiary, Hüttenwerke Krupp Mannesmann (HKM), after thyssenkrupp Steel Europe and Vallourec announced their intention to withdraw from the joint venture.
Following the signing of contracts on 8 July, HKM, an integrated steelworks in Duisburg, Germany, is set to be modernised as part of the Salzgitter Group.
However, the company stated that this transformation would see the elimination of around 2000 jobs.
Gunnar Groebler, CEO of Salzgitter AG, said: "With the acquisition of the shares held by our former co-shareholders, we are now in full responsibility at a historic steel industry site, which we aim to guide toward a sustainable future through a consistent focus on the green transition.
"We would like to thank thyssenkrupp Steel and Vallourec for the constructive negotiations and the good cooperation at HKM over the past years."
Salzgitter AG plans to invest in an electric arc furnace in Duisburg to transform the site and reduce CO₂ emissions from steel production by 90% over the long term.
But, on top of the reduction in workforce, crude steel production will shrink to 2Mt/year.
Birgit Dietze, chief human resources officer at Salzgitter AG, said: "This is a difficult but necessary step. The imminent changes will be implemented in a responsible manner and, as a matter of principle, in a way that is socially compatible. The transformation can only succeed if employees and managers work together.
"Dialogue with employee representatives and communication with the workforce remain a central part of the ongoing process."
The restructuring project is expected to be completed by the end of 2028.
The parties to the agreement have agreed to non-disclosure concerning the details of the agreement.
