By Christoph Steitz and Tom Käckenhoff
FRANKFURT/DUESSELDORF (Reuters) - Britain's Liberty Steel, Europe's fourth-largest steelmaker, said on Monday it had submitted an updated offer for German conglomerate Thyssenkrupp's steel division.
The move comes about three months after Liberty Steel, headed by metals tycoon Sanjeev Gupta, said it had made a non-binding indicative bid for the unit, which Thyssenkrupp has put on the block as part of a bigger group restructuring.
"This is an important step for Liberty demonstrating our binding commitment to the combination of the two businesses," Liberty Steel said in a statement, without disclosing any details of the offer.
"Due diligence and our discussions with Thyssenkrupp have so far confirmed that a potential combination of Thyssenkrupp Steel Europe and Liberty Steel is the right answer from an economic, social, and environmental perspective."
Thyssenkrupp, which sources have said is also considering a spin-off of its steel division, said it would now carefully examine what Liberty Steel says is a "firmed up bid".
A successful bid by Gupta could create synergies of 200-300 million euros ($243-$364 million), analysts at Deutsche Bank estimate, lower than in a potential tie-up for the Thyssenkrupp business with Tata Steel's European unit but higher than in a deal with Sweden's SSAB.
This will partly be achieved by better utilising Thyssenkrupp's steel production sites while cutting Liberty Steel's dependence on roughly 3 million tonnes of hot rolled coil it needs to buy each year.
To woo sceptical workers, Liberty Steel has agreed to guarantee equal board representation for labour and shareholders under Germany's coal-and steel co-determination system, a source close to the process said.
It has also secured significantly higher financial leeway for the bid from SoftBank-backed Greensill, the source said, adding Liberty also planned to honour a previous agreement that rules out forced steel layoffs until 2026.
($1 = 0.8231 euros)
(Editing by Thomas Seythal and Maria Sheahan. Editing by Mark Potter)