Continental AG in talks with parts maker Schaeffler for a $19 billion sale

Mumbai: Continental AG, the world's fourth-largest tyremaker, is in talks with a German family-owned ball bearings maker Schaeffler-Gruppe, in what could lead to a 10 billion euro ($19 billion) sale of the European tyremaker, the Financial Times Deutschland reported, citing sources close to the development.

Reports citing sources said the companies have been in talks for some time and Schaeffler, based in Herzogenaurach, Germany, has secured the necessary financing.
Schaeffler, the report said, is also willing to make a hostile bid if Continental rejects its offer of talks.

Hartmut Meine, a member of Continental's supervisory board and representative of Germany's biggest industrial union, however, said the union would oppose any attempted takeover by Schaeffler.

Continental acknowledged ''one brief conversation about a possible engagement by Schaeffler Group in Continental AG took place at the end of last week," but did not give details.

"As soon as Schaeffler Group has substantiated its plans, the management board of Continental AG will evaluate these and communicate its views in due course," the statement added.

Schaeffler plans to take Continental private and is prepared to offer shareholders ``slightly more'' than 10 billion euros and assume 11 billion euros of debt, a report said, citing unidentified individuals.