(Reuters) -German tire and auto parts maker Continental plans to complete the listing of its automotive business on the Frankfurt stock exchange by the end of 2025, it said on Wednesday.
It also reiterated that its Original Equipment Solutions business that supplies rubber products to carmakers will be divested in the near future, with the sales process starting in the first quarter of 2025.
Continental has aimed to spin off some of its businesses as European carmakers face hurdles, including high costs and Chinese competition, which in turn are hitting their suppliers.
Continental had announced job cuts in its automotive division in February and cut its annual sales guidance for the second time this year in November, citing weak industrial demand in Europe and North America.
Carmakers BMW, Mercedes-Benz, and Stellantis have all issued profit warnings this year, and Volkswagen is locked in marathon talks with union leaders over possible wage cuts and plant closures.
The automotive company will operate under a new brand, which is to be launched by the end of April 2025, Continental said. It will be led by Philipp von Hirschheydt, who has headed the automotive business as a member of Continental’s executive board since 2023.
“The Executive Board’s decision is an important milestone in steadily increasing the value of Continental,” Wolfgang Reitzle, chairman of Continental’s Supervisory Board, said in a statement.
“I firmly believe that the Automotive spin-off will unlock new strengths, because focused companies are more agile, especially in times of transformation.”
Shares in Continental were up 0.5% at 1548 GMT after the announcement.
(Writing by Matthias Williams, editing by Andrey Sychev and Jane Merriman)
