Has Schaeffler Puts the Brakes on Merger With Conti Automotive?

Schaeffler has reportedly brought its plans to merge with Continental’s automotive wing to halt, according to Germany’s Handelsblatt newspaper. “If synergies can be had without a major merger, then it would not put a strain on the organisation,” an unnamed source told the paper. However, the ball bearing maker’s spokesman confirmed, in an email to Bloomberg, that Schaeffler will: “Continue to work on the merger of both automotive operations…But it is certainly not a process that can be completed in the coming months.”

Earlier, Hubertus von Gruenberg, a former Continental AG chief executive, resigned following what the Financial Times (FT) called a “tumultuous meeting of the car-parts supplier’s board.”

FT reported that Schaeffler representatives had proposed to replace von Gruenberg as a board member at the company’s next shareholder meeting in April, accusing him of “sabotaging a joint solution and going after his own interests.” Von Gruenberg had already agreed to resign as chairman in January, however, the latest suggestion appears to have been the straw the broke the camel’s back and the former chairman is said to have resigned with immediate effect. Von Gruenberg criticised Schaeffler for breached the spirit “and content of our investor agreement.”

Continental CEO Karl-Thomas Neumann is said to have repeatedly questioned Schaeffler head, Juergen Geissinger the company’s plan for the future of the combined group without answer.