Conti board approves ‘automotive spin-off'

Hanover, Germany - Continental AG’s supervisory board has approved the planned spin-off of group sector ‘automotive’ and recommended that the AGM meeting in June to approve the step.

Subject to approval, the future independent company is to have cash funds of €1.5 billion by the time of the spin-off, Continental announced 12 March.

Furthermore, the business is also to be strengthened by a revolving credit facility of €2.5 billion.

Continental expects to list the carved out ‘automotive’ company on the Frankfurt Stock Exchange in September.

The allocation ratio is expected to be 2:1, meaning that each Continental shareholder will receive one share in the then listed automotive company for every two Continental shares held.

“As part of this realignment, we are strengthening the independence of all our group sectors: Automotive, Tires and ContiTech,” said Continental CEO Nikolai Setzer.

The move, he said, will enable the group sectors to be “more agile and closer to customers and markets so they can achieve their full growth and value potential.”

Stefan Buchner (member of Continental’s supervisory board) is to chair the supervisory board of the planned independent company.

As previously announced, Philipp von Hirschheydt will continue as CEO of the company after the spin-off.