Continental Bolsters Defences with Citigroup, HSBC

Continental AG has reportedly bolstered its defensive options against a hostile bid from Schaeffler Group with the appointment of Citigroup and HSBC to its defence teams. Quoting sources familiar with the matter, Reuters reported that the move will add two banks with the ability to lend cash from their balance sheets to Goldman Sachs, known for its defensive advisory work. The same source said defensive measure may include “a possible capital increase or striking a deal with a white knight.”

A further report added that Continental is in talks with a “handful” of strategic and financial investors over a possible white knight bid. The Reuters bulletin quoted two unnamed sources as saying the investors, which could also team up, may aim to gain a stake in the company via a capital increase, buying shares on the market or making a public tender offer.