BERLIN, Dec. 29 (Xinhua) -- German industrial giant ThyssenKrupp stock edged up 0.7 percent to 24.22 euros on Friday, ending the year of 2017 with a 7-percent annual rise.
The DAX listed company kept making headlines this year as it tried to merge its steel unit with India's biggest industrial conglomerate Tata's European steel unit, which caused fears among its workers and received strong disagreement.
But the long-standing dispute between Thyssenkrupp's management and the union was settled on Dec. 22 with a deal, paving the way for the merger with Tata and a gradual exit from the volatile business of steel production.
Thyssenkrupp's steel unit will move its headquarters to the Netherlands where it will form part of a new company established together with Tata.
Thyssenkrupp employees had originally voiced fears that such a move would undermine their collective-bargaining rights as workers and lead to dramatic reduction of the labor force.
Through the deal, these concerns have now been allayed with long-term guarantees to preserve existing plants, investment plans and jobs. Thyssenkrupp also raised the possibility of eventually eliminating its involvement in steel production entirely through an Initial Public Offering (IPO) of the unit.
Wilhelm Segerath, Head of the Thyssenkrupp Works Council, described the concessions as "unique and historic".
However, he announced further resistance against shifting the headquarters of the new unit from Germany to the Netherlands. Labor representatives are seeking to exert additional pressure over management by holding a poll among workers to gauge their attitudes towards the planned merger. The results of the vote are scheduled to be revealed on February 5.
Critical to the deal struck by management and labor representatives is a formal pledge to protect workers' jobs until the 30th of September 2026. Although Thyssenkrupp executives still intend to lower headcount by 2,000 staff as a consequence of the merger, these lay-offs are to be achieved in a gradual and socially-responsible manner.
Despite a slight recovery in commodity prices recently, producers such as Thyssenkrupp and Tata Steel continue to suffer from a glut in global steel markets.
By fusing their operations, both companies hope to achieve annual savings of up to 600 million euros (711 million U.S. dollars) and thus place their production on a firmer financial footing.
Initially, Thyssenkrupp and Tata Steel will both hold 50 percent of the newly-established shared corporate entity.
While Thyssenkrupp has said that it wants to remain a shareholder in the joint venture for "at least six years", the firm has refused to rule out prior changes to the ownership structure as it seeks to reduce its exposure to steel production.
