Aurubis Stock Declines After Salzgitter Issues €500 Million Exchangeable Bonds
FRANKFURT, October 15, 2025 — Shares of German copper producer Aurubis AG (NAFG.DE) dropped sharply on Wednesday after major shareholder Salzgitter AG (SZGG.DE) announced a €500 million bond offering exchangeable for 7.6% of Aurubis stock.
The move triggered a 6.7% decline in Aurubis shares, which fell to €108.20 in early Frankfurt trading (07:52 GMT), wiping out gains made earlier in the month.
Aurubis, Europe’s largest copper recycler and one of the world’s leading non-ferrous metals producers, has seen its share price soar this year on the back of strong copper demand and rising metal prices. However, the Salzgitter bond announcement tempered investor enthusiasm and ended takeover speculation that had helped buoy the stock.
Bond Deal Quashes Takeover Speculation
Salzgitter, which currently holds 29.99% of Aurubis, has long been viewed as a potential acquirer of its Hamburg-based peer. A stake above 30% would have automatically triggered a mandatory takeover offer under German securities law.
By issuing bonds exchangeable into Aurubis shares, Salzgitter signaled that it has no immediate plans to expand its ownership, effectively cooling market rumors of a full acquisition.
Analysts said the deal shows Salzgitter’s intent to unlock value and optimize its capital structure rather than pursue corporate control.
Details of the €500 Million Bond Issue
The seven-year bonds, maturing in 2032, offer a fixed annual interest rate of 3.375% and can be exchanged for existing Aurubis shares at an initial exchange price of €145.80 per share.
Salzgitter said the issuance is designed to diversify its financing structure and extend its debt maturity profile, providing flexibility amid changing market conditions.
The company plans to list the bonds on the Open Market segment of the Frankfurt Stock Exchange, ensuring liquidity for investors.
Leading financial institutions BNP Paribas, Commerzbank, Deutsche Bank, and UniCredit acted as joint global coordinators and bookrunners for the transaction.
Meanwhile, Salzgitter shares rose 0.5%, reflecting investor approval of the group’s prudent capital management.
Market Reaction and Investor Sentiment
Aurubis’s sharp decline underscores investor sensitivity to ownership and control dynamics in Europe’s metals and mining sector.
“With Salzgitter effectively ruling out a takeover through this bond structure, speculative buying pressure has dissipated,” said one Frankfurt-based market strategist.
Traders also pointed out that the exchangeable bond’s pricing at a 35% premium to Aurubis’s recent average share price could limit near-term dilution, but the news still weighed heavily on market sentiment.
The copper producer’s stock remains up over 20% year-to-date, supported by robust demand from renewable energy, electric vehicles, and infrastructure development.
Strategic Rationale for Salzgitter
Salzgitter, one of Germany’s largest steel and industrial conglomerates, has been streamlining its portfolio and broadening access to capital markets to support its long-term sustainability and green steel initiatives.
The bond deal, according to the company, aligns with its Salzgitter AG “Salcos” strategy, which aims to transition toward low-carbon steel production and value chain diversification.
By partially monetizing its Aurubis stake without selling shares directly, Salzgitter retains strategic influence while freeing up capital for its own transformation projects.
Copper Market Context: Prices and Demand
Aurubis’s financial outlook remains linked to global copper price trends, which have stayed elevated throughout 2025 amid tight supply and rising consumption in renewable energy and electric mobility sectors.
Copper futures on the London Metal Exchange (LME) have stabilized near $9,500 per tonne, up 8% from the start of the year.
Analysts at Deutsche Bank noted that “the fundamentals for copper remain strong, but valuation pressure could mount if large shareholders adjust their holdings or financing approaches, as seen with Salzgitter.”
Key Financial Figures
| Metric | Value |
|---|---|
| Bond Size | €500 million |
| Exchange Ratio | 7.6% of Aurubis shares |
| Interest Rate | 3.375% per annum |
| Maturity | 2032 (7 years) |
| Initial Exchange Price | €145.80 per share |
| Aurubis Share Price (Oct 15, 2025) | €108.20 (-6.7%) |
| Salzgitter Share Price (Oct 15, 2025) | +0.5% |
Broader Implications for German Industry
The Aurubis-Salzgitter development comes as German industrial firms continue to leverage hybrid financing instruments amid higher interest rates and tightening credit conditions in Europe.
Exchangeable bonds have become an increasingly popular tool for companies seeking to unlock shareholder value without diluting immediate control.
Market observers suggest that other industrial players in Europe may follow a similar model to strengthen their balance sheets while navigating cyclical downturns in commodities and manufacturing.
Conclusion: Aurubis Faces Near-Term Pressure, Long-Term Fundamentals Intact
While Aurubis’s stock faces short-term volatility following Salzgitter’s bond issue, analysts maintain that the company’s long-term fundamentals remain strong, supported by resilient copper demand and efficient recycling operations.
Salzgitter’s move, meanwhile, demonstrates a strategic shift toward flexible financing as it continues to balance shareholder interests with its sustainability goals.
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