Thyssenkrupp Enters the Crucible: Submarines, Steel, and a Spin-Off All Hinge on June Decisions

Thyssenkrupp’s stock has climbed more than 20% since January, closing at €11.72, as investors price in a convergence of three binary events over the coming weeks. The industrial group’s supervisory board must decide the fate of its Materials Services unit, Brussels is about to slam the door on cheap steel imports, and a C$50 billion (€37 billion) submarine contract in Canada is approaching a decision point. For CEO Miguel López, June is the proving ground for his turnaround strategy — but the bill for restructuring is already piling up.

The €37 Billion Submarine Prize

The most transformative catalyst lies under the Arctic ice. Canada is expected to select a winner by the end of June for 12 conventionally powered submarines, with an estimated contract value of up to €37 billion. Thyssenkrupp Marine Systems (TKMS), in which the parent holds roughly 51%, is pitting its 212CD-class boat — designed for Arctic operations — against South Korea’s Hanwha Ocean. Germany’s defence minister, Boris Pistorius, travelled to Ottawa on May 28 and has been lobbying at the Cansec arms fair for a strategic naval alliance with TKMS, though a decision during his visit was not anticipated.

TKMS’s order book already stood at over €20 billion as of March 31, 2026, buoyed by a recent follow-up order from Norway. Beyond Canada, investors are eyeing potential contracts from India and Germany, both expected this year. A Canadian win would nearly double TKMS’s backlog and provide a direct boost to Thyssenkrupp’s consolidated balance sheet.

Should investors sell immediately? Or is it worth buying Thyssenkrupp?

Materials Services: Three Options, One Timeline

Meanwhile, the supervisory board is set to decide on the future of the materials trading division, Materials Services, in June. Three routes are on the table: a spin-off, an initial public offering, or a direct sale. López is accelerating the group’s transformation into a lean financial holding, and sources say invitations to an extraordinary general meeting could be dispatched as early as June, with the shareholder vote pencilled in for late July or early August. The speed of the process has caught many by surprise — and signals that management intends to push the restructuring through despite growing internal criticism.

That criticism is not unfounded. For the current financial year, Thyssenkrupp expects a net loss of between €400 million and €800 million, largely driven by the costs of the overhaul. The market is betting that the long-term payoff outweighs the immediate pain.

EU Steel Shield — and a Factory Closure

For the struggling steel division, relief is coming from Brussels. Starting July 1, the European Union will slash tariff-free import quotas for steel to 18.3 million metric tons annually, a reduction of roughly 47% from 2024 levels. Any shipments that exceed the reduced quotas will face a 50% tariff, double the previous rate of 25%. The European Parliament approved the new regulation at the end of May, and final ratification by the Council is regarded as a formality after both sides agreed in trilogue talks.

The protectionary measures arrive just as Thyssenkrupp Steel Europe is contending with structural headwinds. Its plant for grain-oriented electrical steel in Isbergues, France, will shut down completely from June through September, having run at only half capacity since January. Even with the tariff shield, the division remains under pressure.

Operational Turnaround Gains Traction

Thyssenkrupp at a turning point? This analysis reveals what investors need to know now.

Despite the losses at the group level, the underlying business is showing signs of recovery. In the second quarter of fiscal 2025/2026, Thyssenkrupp’s adjusted EBIT surged to €198 million from a mere €19 million a year earlier. Order intake climbed 32% to €10.6 billion, propelled by Marine Systems. The share price, now more than 60% above its 52-week low of €7.15, is testing the €12.00 resistance level — the same threshold where June’s outcomes will either break the stock higher or send it back down.

Analysts are cautiously optimistic. Deutsche Bank rates the shares a “Buy” with a €14.50 target, Jefferies also says “Buy” at €13.00, while JPMorgan is neutral at €11.80. The stock currently trades about 25% above its 50-day moving average, after notching a weekly gain of over 8%.

With the submarine decision, the steel tariffs, and the Materials Services roadmap all converging within weeks, Thyssenkrupp is not short of catalysts. The question is whether they will arrive in harmony — or collide.

Ad

Thyssenkrupp Stock: New Analysis - 31 May

Fresh Thyssenkrupp information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.

Read our updated Thyssenkrupp analysis...

en | DE0007500001 | THYSSENKRUPP | boerse | 69451655 |