Germany’s Continental is pondering takeover deals to strengthen its tyre business as part of its expansion strategy, the head of the unit said.
“In this context (of finding takeover targets), we are also and particularly thinking of the replacement tyre business,” Nikolai Setzer, head of the tyre division told Reuters on Wednesday.
“We have the financial capability” to shoulder purchases, Setzer said in an interview at the Hanover trucks show.
Continental’s rubber operations, which contributed two-thirds to first-half revenue at the auto parts and tyre maker, helped the group increase first-half profit, benefiting from falling raw material prices.
The Hanover-based company has for some time been on the lookout for takeover opportunities in non-automotive operations to reduce its reliance on the volatile car industry.
Continental’s last major deal was the purchase of U.S. rubber company Veyance Technologies in 2014 for 1.4 billion euros ($1.56 billion).
But Setzer said Continental has no plans to acquire another tyre maker, instead focusing on replacement tyre makers.
“There are not so many tyre makers that could fit us,” the executive said.
($1 = 0.8973 euros) (Reporting by Jan Schwartz. Writing by Andreas Cremer.; Editing by Tina Bellon).
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Source: Reuters.com
