Two partners will have equal representation in the management of the new company, Thyssenkrupp Tata Steel BV, which will become the second largest steel player in Europe after ArcelorMittal, with Euro 17 billion in sales and 21 million tonnes in shipments.

The European steel industry felt the biggest shake-up in more than a decade, as India's Tata Steel Ltd Germany's ThyssenKrupp signed a final agreement today to establish a long-expected steel joint venture.

Thyssenkrupp's logo is seen close to the elevator test tower in Rottweil, Germany, September 25, 2017.

"We remain fully committed to the long-term interest of the joint venture company", Chandrasekaran said.

The deal was a "strong answer to the challenges in the steel market", and would create €5 billion in additional value for both the companies, the two steelmakers said in a joint statement.

Both the steel giant reached to an agreement after months of hectic negotiations since an initial agreement was announced in September a year ago.

Since tariffs were announced in late May, shares in European steelmakers ArcelorMittal, Thyssenkrupp, Salzgitter (SZGG.DE) and Voestalpine (VOES.VI) have lost 8 to 17 percent.

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Thyssenkrupp chief executive Heinrich Hiesinger has previously said the two companies needed to consolidate and become more efficient because of increasing pressure from imports and an overcapacity within the industry.

Under the agreement signed Saturday, each company will hold a 50 per cent stake in the Netherlands-based joint venture called Thyssenkrupp Tata Steel B.V. Thyssenkrupp said it bagged the right to choose when to make a listing.

"The JV not only addresses the challenges of the European steel industry..."

The German group also said it now expects annual synergies of 400 million to 500 million euros from the transaction.

T.V. Narendran, managing director of Tata Steel, said a third of the benefit would come from procurement and one-fifth from network optimisation.

The India-owned steel-maker made headlines in 2016 when it put up its entire United Kingdom operations for sale as the industry began to deteriorate, prompting protests from workers' unions asking to safeguard the jobs of United Kingdom steel workers.