HANOVER, Germany — Continental A.G.'s supervisory board has approved the planned spin-off of the firm's "automotive" business unit and recommended that shareholders approve the step at the annual meeting in June.
Subject to approval, the future independent company is to have cash funds of $1.6 billion by the time of the spin-off, Continental said, and will be buoyed by a revolving credit facility of $2.7 billion.
The move effectively will split the 153-year-old Continental in half, separating the $21 billion automotive unit from Continental's tire and ContiTech industrial businesses, which had sales of $21.9 billion in 2024.
Continental said it expects to list the carved out automotive company on the Frankfurt Stock Exchange in September.
The allocation ratio is expected to be 2:1, meaning that each Continental shareholder will receive one share in the then listed automotive company for every two Continental shares held.
"As part of this realignment, we are strengthening the independence of all our group sectors: Automotive, Tires and ContiTech," Continental CEO Nikolai Setzer said.
The move, he said, will enable the group sectors to be "more agile and closer to customers and markets so they can achieve their full growth and value potential."
Stefan Buchner (member of Continental's supervisory board) is to chair the supervisory board of the planned independent company.
As previously announced, Philipp von Hirschheydt will continue as CEO of the company after the spin-off.
