HANOVER, Germany (Jan. 7, 2010)—Continental A.G. plans to increase its capital by $1.57 billion via a new issue of 31 million shares.
The firm said it will use the funds to pay down debt.
The company set a price of 35 euros, about $50, per share, available on Jan. 12. The issue has been underwritten by a consortium of banks that already placed roughly three-quarters of the new shares.
Continental at the end of December successfully completed negotiations with its creditor banks to modify its credit agreements.
The company's debt grew after it purchased Siemens A.G.'s VDO auto-electronics operations in 2007. Conti said the new capital will help it cut the debt related to that deal