29 January 2009 15:11 [Source: ICIS news]
Schaeffler, a car parts and ball bearing firm, last year took over tyre major Continental in a deal valued at €12.0bn ($15.8bn), but the combined company has since come under severe strain from the global financial crisis.
Hanover-based Continental, with a workforce of about 150,000 in 36 countries and sales of €25bn in 2008, is a large producer of tyres and auto parts as well as an important buyer of styrene butadiene rubber (SBR).
The economics ministry said its officials had a constructive meeting with Schaeffler/Continental late Wednesday and were now waiting for the company to present a “sustainable concept” for further discussion with federal and state governments.
However, Berliner Zeitung, a German daily, quoted finance minister Peer Steinbruck as saying he would oppose aid for the company.
It was not the role of government to bail out companies that were in trouble because of possibly ill-advised strategic decisions, Steinbruck told the paper.
Continental's share price was down 3.2% to €13.80 in Frankfurt. The price compares with €75.00/share Schaeffler offered last August to gain control of Continental.
($1 = €0.76)
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