Outokumpu completes the partnership agreement to accelerate circularity and becomes a minority shareholder in CRONIMET North-East GmbH
Outokumpu Oyj
Press release
January 24, 2024 at 6.00 pm EET
Outokumpu completes the partnership agreement to accelerate circularity and becomes a minority shareholder in CRONIMET North-East GmbH
Outokumpu and CRONIMET announced on November 7, 2023 the expansion of their long-term collaboration to further secure the sourcing and retain the supply of high-quality scrap within Northeastern Europe. Outokumpu has now completed the acquisition of a 10% minority interest in CRONIMET North-East GmbH after having fulfilled customary closing conditions and obtained regulatory approvals. CRONIMET North-East GmbH is the German holding company of CRONIMET’s business in northeastern Europe, holding subsidiaries in the surroundings of Outokumpu’s European production sites.
“We are excited to expand our partnership with CRONIMET, as we have a shared ambition on regional development. We want to accelerate the circular economy in the Northeastern European market area and source recycled steel, which is collected here in the area, close to where it is needed. This is about expanding our existing successful cooperation to ensure that recycled steel that we acquire has the best possible quality and comes from as close as possible, allowing us to decrease the carbon footprint of our production. Our climate targets are ambitious and mean that we need to reduce especially our supply chain emissions. This we can only do in cooperation with our suppliers,” says Marc-Simon Schaar, Chief Procurement Officer at Outokumpu.
Jürgen Pilarsky, CEO of CRONIMET, adds: “I also see our collaboration as a chance to learn from each other and as a great opportunity to drive our CO2 reduction ambitions forward together, as we are both committed to the SBTi targets. And, moreover, this partnership is an excellent example of the implementation of the 17th UN goal, which promotes the formation of partnerships to achieve the Sustainable Development Goals.”
In addition to agreeing on the sourcing and supply of high-quality scrap within Northeastern Europe, the parties will also cooperate on joint innovation and research with the goal to improve technologies to further reduce CO2 emissions, to lower costs through better predictability and to drive waste reduction within the supply chain. Together with better scrap quality, this will enable an improvement in Outokumpu’s and CRONIMET’s process efficiency.
As a shareholder, Outokumpu acts as a strategic partner in CRONIMET’s Northeastern business, while CRONIMET retains full operational control of the companies involved. Outokumpu does not see vertical integration into the supply chain of stainless steel scrap as part of its raw material strategy but considers cooperation and partnerships as the way forward.
The transaction was carried out as a share purchase. Outokumpu will report CRONIMET North-East GmbH using the equity accounting method in its financial reporting as of the first quarter in 2024.
For more information:
Investors: Linda Häkkilä, Head of Investor Relations, tel. +358 400 719 669
Media: Päivi Allenius, VP – Communications & Brand, tel. +358 40 753 7374 or Outokumpu media desk, +358 40 351 9840
Outokumpu Oyj
Outokumpu is the global leader in stainless steel. The foundation of our business is our ability to tailor stainless steel into any form and for almost any purpose. Stainless steel is sustainable, durable and designed to last forever. Our customers use it to create civilization’s basic structures and its most famous landmarks as well as products for households and various industries. Outokumpu employs approximately 8,500 professionals in close to 30 countries, with headquarters in Helsinki, Finland and shares listed in Nasdaq Helsinki. www.outokumpu.com
