Worthington Steel in Talks to Acquire German Rival Kloeckner & Co
The potential deal would see the newly independent U.S. steel processor expand its footprint into the European market in a significant cross-border acquisition.
U.S. steel processor Worthington Steel Inc. (NYSE: WS) has confirmed it is in discussions to acquire its smaller German competitor, Kloeckner & Co, a potential cross-border deal that would significantly expand the American company's international reach.
The Columbus, Ohio-based company, with a market capitalization of approximately $1.8 billion, is exploring a takeover of the Duisburg-based steel distributor, which is valued at around $630 million. The move represents a bold strategic step for Worthington Steel, which began trading as an independent public company following its spinoff from Worthington Industries.
Both companies issued cautious statements confirming the negotiations. Worthington Steel stated it is in talks "about a potential voluntary public takeover offer of Kloeckner & Co SE," but emphasized that "no investment decision has been made now and the discussions may not result in a transaction," according to a company press release. The company added that it does not intend to comment further.
Similarly, Kloeckner & Co acknowledged rumors that Worthington Steel is conducting a due diligence review. The German firm noted, "It is currently uncertain whether or under which conditions a potential voluntary public takeover offer will be pursued."
A successful acquisition would unite two major players in the steel and metals services industry. Worthington Steel is a key processor of value-added steel products for the automotive, construction, and consumer goods markets in North America. The company has a solid financial footing, with a price-to-earnings ratio of approximately 15.3 and a stock that has traded between $21.07 and $44.52 over the past 52 weeks.
The potential transaction aligns with Kloeckner & Co's stated corporate strategy, "Leveraging Strengths – Step Up 2030," which aims to transform the company from a traditional steel distributor into a leading metal processor and service center company in North America and Europe. An acquisition by a well-capitalized U.S. counterpart could provide the resources to accelerate this transition, particularly in the competitive North American market where both firms operate.
Kloeckner has been actively expanding its higher value-added business to reduce its dependence on volatile commodity prices and has been a pioneer in the digital transformation of the steel supply chain. The company is also focused on the growing market for CO2-reduced "green" metals, an area of increasing importance for industrial suppliers.
The combination would grant Worthington Steel a significant foothold in the European distribution market while expanding its portfolio of value-added services. For Kloeckner, the deal could offer stability and growth opportunities as part of a larger, U.S.-domiciled entity. The market will be closely watching for further announcements and potential regulatory filings, particularly in Germany where takeover offer rules require detailed disclosures.