Continental set to resist Schaeffler merger: report
German auto parts group Continental no longer wishes to merge with its dominant shareholder Schaeffler, the weekly Manager Magazin said Tuesday, citing sources close to Continental.
Neither group wished to comment when contacted by AFP.
The magazine said on its website that Continental directors are looking at ways to reduce Schaeffler's 75-percent stake, in what could become the next chapter in a long-running takeover saga.
Continental, which has sales that are three times larger than Schaeffler, a family-owned ball-bearing specialist, resisted a takeover attempt before caving in in 2008.
But Schaeffler became heavily indebted in the process and said in February that it would take "at least until 2011" to finalise what had become more of a merger than a takeover.
Schaeffler's debt of some 5.9 billion euros (7.75 billion dollars) made a quick integration of Continental, which is best known for its tyres, problematic.
Meanwhile, Continental is being crushed by its own debt load of eight billion euros that resulted in large part from its own takeover of VDO, an auto parts company once owned by the industrial giant Siemens.
In afternoon trading on the Frankfurt stock exchange, shares in Continental showed a gain of 2.07 percent to 60.65 euros.
The MDax index of mid-cap stocks on which it is listed was 1.20 percent higher overall.
© 2010 AFP