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Conti board OKs capital increase

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HANOVER, Germany (Aug. 31, 2009)—Continental A.G.'s supervisory board has approved an increase in the firm's capital by more than $2 billion and disclosed it wants to discuss with its creditor banks ways to handle credit instruments worth $5 billion that will come due in August 2010.

The capital increase will provide Conti with a sound financial structure for the medium and long term, the firm said. It will raise the capital by issuing new shares, according to former Executive Board Chairman Karl-Thomas Neumann, who stepped down from that post Aug. 12.

"This capital increase provides us not only with greater entrepreneurial flexibility," he said, "it also gives all of us a bit more security."

The decision also will benefit Conti's largest shareholder, Schaeffler Group, Mr. Neuman added.

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