Continental announced the sale of its ContiTech group sector to an affiliate of Lone Star Funds for EUR 4B. The transaction also includes performance-based components of up to EUR 250M in subsequent years. The sale of its industrial business is the final step in Continental’s realignment. Once completed, the DAX-listed company will become a pure-play tire manufacturer for the first time in its history. The transaction is subject to regulatory approval. After taking into account transferred net liabilities, particularly pension and leasing commitments, Continental expects a cash inflow from the transaction of around EUR 3.1B. Around EUR 2.5B is expected to be used for a special dividend or for a combination of a special dividend and share buybacks. Lone Star Funds will take over all of ContiTech’s business operations worldwide.
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