Upgrading their rating to “buy”, Jefferies analysts said: “Siemen’s recent spin-off of Energy gives confidence that Conti’s share price will benefit from its planned spin-off of Vitesco as the combined market cap of Siemens and Energy was up 7 per cent on the day of transaction (DAX +3%)” The implication, they explained, was that there was a discount in Siemens’ sum-of-the-parts valuation. That being the case, given Conti’s “more attractive transaction structure”, the analysts predicted that Conti’s “re-rating should be more pronounced.”
The recent news that Continental AG will close its Aachen, Germany tyre factory underlines the fact that it is aiming to cut 13,000 of 59,000 jobs in Germany as part of a major group-wide cost-cutting programme. Now, the German Manager Magazin is reporting that Continental is also considering the sale of parts of the wider group. Indeed, Continental is said to be in talks “already with prospective customers”. The Rubber Technologies business sector, which includes Continentals Tire and ContiTech division is also said to be affected.
Concerns about the affect of global trade concerns and Brexit upon Europe’s financial markets have led Titan International to postpone a potential listing of its Italtractor ITM S.p.A. (ITM) business. According to company chairman Maurice Taylor, these factors have impacted the company’s ability to suitably evaluate its strategic alternatives with respect to ITM.
Marangoni has spun off its Meccanica, which designs and manufactures tyre-making equipment. According to a company statement received on 14 June 2019, Marangoni Meccanica has now, therefore, been separated from the main body of the Marangoni Group.
In February, Titan International disclosed it was “evaluating its strategic alternatives” regarding its Italtractor ITM S.p.A. (ITM) steel track and undercarriage business. It engaged Shore Capital as its financial advisor in carrying out this evaluation. Paul Reitz, the company’s president and chief executive officer, reports that Titan is making “positive progress” with respect to one potential alternative, a public listing within Europe.
After placing its Italtractor ITM S.p.A. (ITM) steel track and undercarriage business on the market some two and a half years ago and receiving seven formal bids from potential buyers, Titan International, Inc. then withdrew ITM from sale in response to the operation’s improving revenue and EBITDA. Now it seems the possibility of divesting ITM is once again under consideration.
Arconic Inc., the company created to house the Alcoa wheel business and other metal manufacturing functions following the separation of Alcoa Inc. into two entities last November, is divesting its stake in the other entity, Alcoa Corporation, which is engaged in the mining and manufacture of raw aluminium. The debt-for-equity exchange of Alcoa Corporation common stock will see 12,958,767 shares swapped for debt held by Citigroup Global Markets Inc. and Credit Suisse Securities (USA) LLC.
Four years ago, STARCO established a new subsidiary in South Africa together with its local distributor, Mac and TireCity. The company has now decided to divest its 50 per cent shareholding and exit South Africa in order to strengthen its focus on its core business and OEM customers across Europe. STARCO’s shareholding has been transferred to a newly-established company owned by Mac and TireCity.
Following the necessary approval from relevant authorities, Trelleborg has divested all its shares in the Vibracoustic joint venture to former partner Freudenberg. As of 5 July the Swedish company has received a payment of approximately SEK 6.2 billion (£556.4 million) for the shares, and the remaining 10 per cent of the purchase price is subject to Vibracoustic’s forecast sales performance this year and in 2017. Accordingly, Trelleborg reports that the final consideration “may be somewhat higher or lower than SEK 6.8 billion (£610.7 million).” In addition to the purchase price, Trelleborg received a dividend of approximately SEK 1.4 billion in December 2015.
The chief financial officer of Kesoram Industries reports that the company will invest Rs 3 billion (£29.3 million) into passenger car radial tyre production. Tridib Kumar Das told Indian financial daily Business Standard that the investment will be made in addition to the Rs 5 billion already spent on the car radial project, and that the company intends to bring its passenger car radials to market in May 2016.
Swedish firm Trelleborg has signed an agreement to divest a facility that manufactures rubber drive shaft and steering boots for light vehicles. The business operation is based in Spain and is part of the Trelleborg Industrial Solutions business area. The buyer is the French Group Delmon Industrie S.A.