Tire maker Continental says it may spin off automotive-electronics unit employing 100,000
By Steve Goldstein
German tire maker Continental said Monday it may spin off the loss-making automotive-electronics unit that employs 100,000 people.
"Markets and customers, especially in the automotive industry, have evolved extremely dynamically in recent months. Looking ahead, sharply fluctuating regional developments in the markets as well as the software-driven technology transformation will require even greater flexibility and entrepreneurial freedom. Against this backdrop, we are aiming to divide Continental into two independent companies," Continental Chief Executive Nikolai Setzer said.
The spin could "create competitive opportunities" and give the ability to invest in a company solely focused on automotive electronics, the company said.
Continental shares (XE:CON) moved off the lowest levels of the day after the announcement, going from a decline of about 4% to a decline of 2%.
The company said the board will make a decision by the fourth quarter and potentially put it to shareholders by next year. Continental says if it does spin off the unit, it would also be onto the Frankfurt Stock Exchange where its current listing is.
Continental said the division has carved out a strong market position for brake and comfort systems, as well as sensor solutions and displays. The company is developing software, architecture platforms and assistance systems for software-defined and autonomous vehicles.
The remaining business would also employ about 100,000, focused on tires and industrial solutions.
-Steve Goldstein
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
08-05-24 0803ET
Copyright (c) 2024 Dow Jones & Company, Inc.-
What’s Happening in the Markets This Week
-
Worst-Performing Stock ETFs of the Quarter
-
Q3 in Review and Q4 2024 Market Outlook
-
Top-Performing Stock ETFs of the Quarter
-
September Jobs Report Forecasts Show Moderate Hiring Gains
-
Port Strike a Headache for Shippers but a Potential Tailwind for Certain US Transport Stocks
-
13 Charts on Q3′s Roller-Coaster Rally for Stocks and Bonds
-
5 Stocks to Buy Instead of Overpriced US Equities
-
Consumer Defensives: Despite Angst, Thirsty Investors Have Names to Pursue
-
Industrials: Many Stocks Overvalued After Q3 Outperformance
-
Basic Materials: Despite Index Rise, We See Multiple Long-Term Opportunities
-
What the Election Could Mean for Big Tech Stocks
-
3 Lessons From Recent Stock Market Drama
-
Consumer Cyclicals: Even Amid Moderating Consumer Spending, We See Discounts
-
Healthcare: Valuations Look Fair Overall, With Select Industries Still Undervalued
-
Utilities: Falling Interest Rates, Growth Outlook Boosting Stocks