HERZOGENAURACH, Germany (July 30, 2008) — Schaeffler Group has increased the value of its bid to acquire a sizeable stake in Continental A.G. to about $109 a share.
Schaeffler's bid, which ends at midnight Aug. 27, is for a “strategic shareholding” of more than 30 percent in Conti. Schaeffler said such a shareholding is necessary to achieve a “stable shareholder structure” in Conti, which would enable it to implement its objectives and safeguard its long-term investment.
Conti has not commented on Schaeffler's lastest bid, which Schaeffler said is a premium of nearly 30 percent over the tire and automotive systems maker's July 11 market value. It is, however, a few dollars shy of Conti's trading value on July 30.
Previously, Conti's supervisory and executive boards rejected Schaeffler's original bid — about $1.20 lower than the new offer — calling it “highly opportunistic, does not come close to the true value of Continental, does not create trust and lacks a convincing strategic rationale.”
In addition, Conti claims Schaeffler already has indirect control of up to 36 percent of its shares through the help of banks and derivative positions, a practice it said is in contravention of reporting and notification requirements.