Thyssenkrupp Steel may have a regional suitor: The UAE’s largest steel and building materials company Emirates Steel Arkan is mulling over a minority stake in leading German conglomerate Thyssenkrupp AG’s steel unit, Bloomberg reports, citing people with knowledge of the matter. The Abu Dhabi state-backed group could make a formal bid within the next few months, according to the business information news service.

What we know: The Emirati company is considering a minority acquisition in the steel unit as part of a business partnership, the sources said. It would manufacture products using renewable energy sources then ship the products to Germany to be shaped and finished for use in the automotive industry by Thyssenkrupp.

Not the only contender in the race: Other suitors include India’s JSW Steel and buyout firm CVC Capital partners, who have shown interest in the past months, the sources said. However, talks with the other contenders are not as active, they added.

Crunch time: The acquisition talks come as the German conglomerate’s incoming CEO Miguel Angel Lopez Borrego, who takes the reins on 1 June, is set to face the same challenge in divesting the group that three predecessors failed to overcome, Reuters reports. Growing opposition to a plan to offload the unit pushed Borrego’s predecessor Martina Merz to ask to terminate her contract five years early on the back of opposition from labor unit representatives and pushback from her management board.

Who is Emirates Steel Arkan? The company is the result of a merger initiated by UAE sovereign wealth fund ADQ between Emirates Steel Industries with Arkan Building Materials in 2021. Its steel products were used in several prominent construction projects including Dubai’s Burj Khalifa, Sheikh Zayed Grand Mosque, and Louvre Abu Dhabi, according to its website.