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Thyssenkrupp to cut 5,000 more jobs after slumping to €5.5bn loss

Thyssenkrupp, the ailing German steel and materials group, plunged to a full-year loss of €5.5bn and said it would cut 5,000 more jobs, as the pandemic increased pressure on the former conglomerate to speed up the sale of underperforming businesses.

The Essen-based company, which still employs more than 100,000 people, also warned that it expected a further loss of at least €1bn this financial year, as its restructuring costs spiral.

In May, a deep restructuring plan was outlined that would result in several smaller businesses -- with combined sales of more than €6bn a year and 20,000 employees -- leaving the company completely, and the remaining units being run under a loose holding structure.

The extra job cuts announced on Thursday bring the total number of roles at risk to 11,000, almost 7,000 of which are in Germany.

Last month, the group revealed it had received an approach for its steel unit, which employs roughly 27,000 people and made a loss of €946m in the last financial year, from British tycoon Sanjeev Gupta's company, Liberty Steel. Neither company disclosed details of the approach.

The division, which has been struggling to compete with cheaper imports, has been hit hard by its reliance on business from the auto industry. The sector, which is forecast to contract by almost a quarter in 2020, accounts for roughly 40 per cent of Thyssenkrupp's steel sales.

The industrial group is also in exploratory discussions with other steelmakers, including Sweden's SSAB, and is talking to the German government about potential financing from the state, according to people familiar with the matter.

Despite a tie-up with India's Tata having been blocked by the European Commission last year, the companies are revisiting a possible merger, which could face fewer objections from Brussels owing to subsequent changes in the make-up of the EU steel market.

Thyssenkrupp said it hoped to decide on the next steps for the steel unit in the spring.