Log in
Login
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
Settings
Settings
Dynamic quotes 

4-Traders Homepage  >  Equities  >  Xetra  >  Continental AG    CON   DE0005439004

End-of-day quote. End-of-day quote  - 05/05
183 EUR   -1.45%
05/04 CONTINENTAL : Practical test proves premium tires from Continental a..
05/04 Continental expects no major hit from carmakers' price cuts - CFO
05/04 CONTINENTAL : Raises Cash Flow Forecast for Current Fiscal Year
SummaryQuotesChartsNewsAnalysisCalendarCompanyFinancialsConsensusRevisions 
News SummaryMost relevantAll newsSector news 

CONTINENTAL : rejects $18 bln bid from family firm

share with twitter share with LinkedIn share with facebook
share via e-mail
0
07/16/2008 | 12:16pm CEST

Tires-to-brakes maker Continental rejected Schaeffler Group's surprise 11.2 billion euro ($17.8 billion) bid, saying only the family owned firm stood to gain from the offer which was too low.

By Christiaan Hetzner and John O'Donnell

Late on Tuesday, the ball-bearing maker announced the terms of its proposed takeover after winning control of more than a third of Continental's shares through a web of options organized for it discretely by banks.

If Schaeffler succeeds in buying the Hanover-based group, which is three times its size, it would be the first time a German family business takes over a company listed on the country's blue-chip DAX index.

The takeover, which would also see Schaeffler take on Continental's 11-billion-euro-plus debt pile, would be the biggest so far this year in Europe and put the car-parts supplier nose-to-nose with Germany's Bosch.

Continental is working with Goldman Sachs to mount a defence against Schaeffler, owned by German billionaire Maria-Elisabeth Schaeffler.

Schaeffler chief Juergen Geissinger had sought to calm management fears, saying that he did not intend to break up Continental or slash jobs. Both firms, he said, were a good fit.

But on Wednesday, Continental's Chief Executive Manfred Wennemer told shareholders not to accept the offer and pledged to fight for the company's independence.

Schaeffler's offer of 69.37 euros per share in cash, he said, did not reflect the full value of the company. Continental's stock was trading slightly down at 73.17 euros, after strong gains in recent days.

"There is no convincing strategic rationale for a business combination," Continental said.

TYRE PRESSURE

Continental was built through a series of acquisitions of high-tech car parts makers, bought with money earned selling car tyres.

Weakened by heavy borrowing to pay for its roughly 11 billion euro purchase of VDO -- which makes the technology inside satellite navigation and fuel injection systems -- Continental now faces a slowdown in car buying as high oil prices bite.

Over the past year, like many rivals, Continental's stock has suffered. Before this week's bounce, it had halved in value.

It had long been speculated that a private equity firm might buy Continental, but those investors rely heavily on debt and the credit crunch makes it harder for them to compete with often cash-rich trade buyers.

Schaeffler's move is similar to that of Porsche's <PSHG_p.DE> takeover of Volkswagen <VOWG.DE>. The smaller sports car maker also bought a stake of 30 percent, made a token takeover bid and is now covertly creeping towards majority control.

(Additional reporting by Arno Schuetze in Hanover)

(Editing by Erica Billingham)

share with twitter share with LinkedIn share with facebook
share via e-mail
0
React to this article
Latest news on CONTINENTAL AG
05/04 CONTINENTAL : Practical test proves premium tires from Continental are fuel-save..
05/04 Continental expects no major hit from carmakers' price cuts - CFO
05/04 CONTINENTAL : Raises Cash Flow Forecast for Current Fiscal Year
05/04 DGAP-NEWS : Continental AG: Continental erhöht Cashflow-Prognose für das laufend..
05/04 DGAP-NEWS : Continental AG: Continental Raises Cash Flow Forecast for Current Fi..
05/03 CONTINENTAL : After a Good Start to 2016, Continental Raises Margin Forecast
05/02 ONE STEP BEYOND : Continental Wins 2016 AutomotiveINNOVATIONS Award
05/02 CONTINENTAL AG : ex-dividend day for annual dividend
04/29 CONTINENTAL : Federal Contracts Awarded by Federal Agencies in Michigan (April 2..
04/29 CONTINENTAL : ContiTech Continues to Grow
Advertisement
News chart
Full-screen chart
Income Statement Evolution
More Financials