Due to the increasingly dynamic markets in the automotive industry, German firm Continental says it has decided, following a strategic review, to conduct a further detailed evaluation on spinning off the Automotive group sector. The aim of having two independent companies is to fully harness Continental’s value and growth potential. Following its detailed evaluation, the Executive Board will make a decision on the spin-off in the fourth quarter of 2024.
Subject to the approval of the Executive Board and Supervisory Board, a spin-off and listing of Automotive would then be put to a vote by the Annual Shareholders’ Meeting of Continental AG on April 25, 2025.
If approved, the plan is to complete the spin-off by the end of 2025. The preparations for a spin-off are already underway. As part of the setup, the profitable Tires and ContiTech group sectors would remain under the umbrella of Continental. This structure will also be part of the detailed evaluation.
“Our strategy aims to increase our value creation. This involves systematically analysing how we can best position our group sectors for success. 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,” said Continental CEO Nikolai Setzer.
As with the spin-off of Vitesco Technologies in September 2021, Continental shareholders would receive shares in an independently listed Automotive entity in proportion to their Continental holding.
The Automotive group sector – which has already had its activities consolidated in a single legal entity since 2022 – would become a fully independent company as a result of the planned spin-off.
Automotive generated sales of around EUR20.3 billion in the past fiscal year and currently employs around 100,000 people. The group sector has a strong market position for innovative brake and comfort systems, sensor solutions and displays, as well as in developing software, architecture platforms and assistance systems for the rapidly growing future market of software-defined and autonomous vehicles.
The Tires and ContiTech group sectors currently employ around 100,000 people and generated combined sales of around EUR20.8 billion in the past fiscal year.