Outokumpu and CRONIMET Strengthen Partnership to Boost Circular Economy and Reduce CO2 Emissions in Stainless Steel Production

Outokumpu and CRONIMET Strengthen Partnership to Boost Circular Economy and Reduce CO2 Emissions in Stainless Steel Production

(IN BRIEF) Outokumpu, a global leader in sustainable stainless steel, and CRONIMET, a global leader in recycled stainless steel, are expanding their collaboration to enhance the sourcing and supply of high-quality scrap in Northeastern Europe. Outokumpu has agreed to acquire a 10% minority stake in CRONIMET North-East GmbH, the holding company for CRONIMET’s Northeastern European business, which includes subsidiaries near Outokumpu’s European production sites. This partnership aims to secure a continuous supply of high-quality stainless steel scrap, vital for maintaining Outokumpu’s industry-leading recycled content rate of 94% and achieving ambitious climate targets. The companies will also cooperate on innovation, research, and technology advancements to reduce CO2 emissions, lower costs, and minimize waste throughout the supply chain. While Outokumpu becomes a strategic partner in CRONIMET’s Northeastern business, CRONIMET maintains operational control, and the transaction is subject to customary closing conditions and regulatory approvals.

(PRESS RELEASE) HELSINKI, 7-NOV-2023 — /EuropaWire/ — Outokumpu, the global leader in sustainable stainless steel, and CRONIMET, the global leader in recycled stainless steel, are expanding collaboration to further secure the sourcing and retain the supply of high-quality scrap within Northeastern Europe. Outokumpu has signed an agreement to acquire a 10% minority interest in CRONIMET North-East GmbH, the holding company for CRONIMET’s Northeastern business in Europe, holding subsidiaries in the surroundings of Outokumpu’s European production sites. The continuous supply of high-quality stainless steel scrap is an important factor in maintaining and increasing the industry-highest rate of recycled content of 94% and continuing to achieve the company’s ambitious climate targets.

“Partnering around our value chain and strengthening our sustainability leadership are key priorities in our strategy. Outokumpu has the lowest carbon footprint in the stainless steel industry, 70% smaller than the global average*, which is a competitive advantage for us. The better the quality and the closer the scrap is sourced, the smaller the carbon footprint of our production, allowing Outokumpu to decrease the supply chain emissions further. We are excited about this partnership with CRONIMET, as we have a shared ambition on regional development – to accelerate the circular economy in the Northeastern European market area. Together, we can further strengthen our scrap supply and drive green transition in the industry”, says Marc-Simon Schaar, Chief Procurement Officer at Outokumpu.

Outokumpu and CRONIMET have also agreed to cooperate in areas such as joint innovation and research with the goal to improve technologies to further reduce CO2 emissions, lower costs through better predictability and drive waste reduction within the supply chain. Jointly with better scrap quality this will enable an improvement in Outokumpu’s process efficiency.

“This partnership is another step to achieve the sustainable development goals: low CO₂ footprint for stainless production with locally sourced stainless scrap,” says Jürgen Pilarsky, CEO of CRONIMET Holding GmbH.

As a shareholder, Outokumpu acts as a strategic partner in CRONIMET’s Northeastern business, thus, expanding the successful existing collaboration, 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 completion of the transaction is subject to customary closing conditions and regulatory approvals by the competition authorities. The transaction will be carried out as a share sale.

*) Global average CO₂ emissions (2023): 7 kilos of CO₂e per kg of stainless steel (based on data provided by CRU and worldstainless).

Media Contact:

Investors:
Linda Häkkilä
Head of Investor Relations
tel.: +358 400 719 669

Media:
Päivi Allenius
VP – Communications & Brand
tel.: +358 40 753 7374

Outokumpu media desk:
+358 40 351 9840

SOURCE: Outokumpu Oyj