Conti Considers Peer Acquisition to Defend Against Schaeffler Bid

Continental is considering the option of purchasing a peer company as part of its defence against the Schaeffler Group’s 11.3 billion acquisition bid, according to information published in the Financial Times on August 9. The newspaper quoted sources close to the situation as saying Conti was engaging in “concrete talks” with several listed and unlisted international rivals about a possible multi-billion-euro deal, however Conti has not commented on the validity of this news.

The report said any deal, which would be structured as an all-share bid, would most likely be funded via a capital increase of about 20 per cent, which would be worth more than 2 billion euros. The move would have the dual effect of strengthening Continental’s position, while simultaneously diluting the the value of Schaeffler’s stake. Schaeffler has previously warned Continental not to resist its bid by means of a large capital increase.

Meanwhile, Financial Times Deutschland reported that major buyout firms Blackstone, Bain Capital, KKR, Goldman Sachs, Permira all declined to be the company’s white knight.