HANOVER, Germany (March 29, 2004) — Continental A.G. has launched a bid to buy all the outstanding shares of fellow German non-tire rubber products maker Phoenix A.G. in a deal valued at nearly $275 million.
Acquiring Hamburg, Germany-based Phoenix would strengthen Continental's ContiTech non-tire products division internationally, especially in the fluid transfer, conveyor belt and air spring systems. Phoenix had sales of $1.24 billion last year, whereas ContiTech's sales were $2 billion.
Conti claims to have the support of Phoenix' two largest shareholders, who control 37 percent of the stock.
“We expect the combination of ContiTech and Phoenix to create synergies of approximately $36 million per year,” said Continental CEO Manfred Wennemer. Continental intends to analyze in detail the business opportunities arising from the acquisition, together with the management board of Phoenix, Mr. Wennemer said.
Conti's bid is 15 euros ($18) per share. Conti said it has the support of Claas E. Daun, chairman of Phoenix' supervisory board and holder of 22.3 percent of the firm's shares, and of the German bank WestLB, which holds 14.9 percent.
Phoenix declined to comment on the offer, other than to say its executive and supervisory boards would release a statement after examining Conti's formal bid.