Schaeffler Warns Continental Off Capital Raising Defence

Schaeffler Group has warned Continental not to employ a large capital increase as a way of warding off its 11.3 billion euro unsolicited takeover bid. Schaeffler’s move meant dropping a condition that would end the bid if Continental prepared to raise its share capital during the offer period, which is due to end on 27 August. “Schaeffler group thus counters market speculation that its offer to Continental shareholders could be prevented by such…measures,” an official statement explained.

“The Schaeffler group, which now is Continental’s biggest shareholder with more than 8 per cent of the shares, considers the adoption of capital measures unjustifiable because they would harm the interests of Continental shareholders,” the statement continued.

According to a Reuters report, Schaeffler has already prepared loans totalling 16.1 billion euros in support of the bid. Meanwhile Handelsblatt reported that Continental has been in talks with private equity firms including Apollo and KKR. KRR is reportedly not interested.