Germany’s Continental aspires to purchase Veyance Technologies Inc. from the Carlyle Group, but has been slow in doing so.
This is because it faced a huge roadblock in December when it received a conditional approval from the US Department of Justice to finalise the acquisition of the multifaceted rubber product producer. The condition requires that it divest Veyance’s air spring business in the NAFTA region, an air springs plant in San Luis Potosi, Mexico, and a technical office in Ohio.
ContiTech, a division of Continental, reached the deal to purchase Fairlawn-based Veyance last February for US$1.91 billion. ContiTech posted sales of US$5.3 billion in 2013 while Veyance had US$2 billion.
Divesting the air springs operation is a major concession on the part of Continental because “in our estimation that would have brought clear benefits for our customers,” said Heinz-Gerhard Wente, a member of Continental’s executive board and CEO of ContiTech, the operation that will gain the most from the acquisition of Veyance
In other news, Continental Corporation has announced that it expects a growth of 5 % this year.
It also said that the company managed to grow year-on-year, and achieved approximately €34.5 billion. The company’s adjusted EBIT margin exceeded 11%.
“For 2015, we expect global production figures for passenger cars with a gross vehicle weight rating up to 6 tonnes to increase moderately once again, rising from around 87 to roughly 89 million vehicles,” Continental Executive Board chairman Dr. Elmar Degenhart said.
“We are therefore aiming for sales growth of around 5% to a figure exceeding €36 billion. With this, we want to once again securely confirm our double-digit adjusted EBIT margin,” he added.