Iranian dropped from German steel giant board

14th December 2004, Comments 0 comments

15 December 2004 , DUSSELDORF - German steel and engineering giant ThyssenKrupp is retiring an Iranian government vice-minister from its supervisory board after criticism from the United States. The conglomerate has published the nominations for its 23- member board without the name of Mohamad-Mehdi Navab-Motlagh included. Navab-Motlagh is vice minister for economics and international affairs in the Industrial and Mining Ministry in Teheran. Analysts said the move appeared linked to ThyssenKrupp's broader

15 December 2004  

DUSSELDORF - German steel and engineering giant ThyssenKrupp is retiring an Iranian government vice-minister from its supervisory board after criticism from the United States.

The conglomerate has published the nominations for its 23- member board without the name of Mohamad-Mehdi Navab-Motlagh included. Navab-Motlagh is vice minister for economics and international affairs in the Industrial and Mining Ministry in Teheran.

Analysts said the move appeared linked to ThyssenKrupp's broader campaign to reduce the Iranian share in the company, an investment begun by the former shah in 1974.

Because the post-Shah Iranian government retained the shares in ThyssenKrupp, the German company risked being ostracised as an "Iranian" enterprise when doing business with the United States government.

Washington applies sanctions to Iran, which it accuses of supporting terrorism. Those penalties apply to all Iranian-owned enterprises worldwide and the United States warned that ThyssenKrupp would be placed on a "black list" unless Iran reduced its stake.

In a first move to avoid sanctions, ThyssenKrupp paid about three times the market price in May last year to buy back almost 17 million company shares from Iran.

The world's biggest producer of stainless steel paid EUR 406 million or around EUR 24. As a result, Iran's holding in the Dusseldorf-based company fell from 7.8 percent to 4.5 percent.

Iran's earlier stake entitled it to a board seat, which it no longer was entitled to with its reduced holding.

Lawyers say ThyssenKrupp needed to reduce the Iranian investment to below 5 percent to avoid being treated as a "Teheran" firm, barring it from tendering military and civilian goods to the US government.

Earlier this year it was reported that Iran was considering selling the remaining ThyssenKrupp stake and had sounded out investment banks about arranging a sale, but this was not confirmed. 

DPA

Subject: German news 

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