Auto parts maker Continental AG said Thursday it had ended a weeks-long standoff over a takeover bid from smaller rival Schaeffler KG after the suitor raised its offer and agreed to limit itself to a minority stake. But the deal claimed a prominent victim: Continental chief executive Manfred Wennemer, who had led resistance to a deal with Schaeffler. The 60-year-old “asked the supervisory board to be released from his responsibilities” by the end of August, Continental said. Continental had repeatedly rejected the offer Schaeffler made last month. It said in a statement the deal now reached with the privately held company offers “an acceptable overall concept.” Continental said Schaeffler had agreed to increase its offered price per share to $110.50 from $103.31. Continental did not give an overall value for the new offer. Schaeffler also agreed to limit its stake to a maximum 49.99 percent for four years, Continental said in the statement. Ferdinand Dudenhoeffer, a professor of automotive economics at the University of Gelsenkirchen, estimated that buying just short of half Continental's stock would cost Schaeffler between and $6.6 billion and $7.4 billion. He said it was a “sensible and forward-looking deal” that allows the companies to complement each other and realize cost advantages in areas such as the powertrain business, in which Continental said they would examine possible “strategic cooperation projects.” Continental said Schaeffler committed itself “to support the ongoing strategy and business policies of Continental AG's management board while maintaining its current market and brand appearance, and to not demand a sale of activities or seek other material structural measures.” Continental makes products including tires, brakes and interiors for cars and trucks. Wennemer and union representatives had voiced fears that Schaeffler might sell the company's tire division if successful in its takeover bid. Wennemer has been CEO of Continental since September 2001 and helped oversee its expansion and shifting of production to low-cost markets. His company said a successor would be appointed “in the immediate future.” Continental said that, under the deal, former German Chancellor Gerhard Schroeder would act as a “guarantor for ensuring the interests of all stakeholders of Continental.” Schaeffler makes ball bearings for the industrial, aviation, aerospace and the automotive sectors as well as components for engines, transmissions and drive trains. Schaeffler chief executive Juergen Geissinger said his company had always sought “a constructive agreement.” He said in a statement that the deal allows for “the combination of two German technology leaders that will deliver innovative solutions for the future challenges of the automobile industry.” Shares of Continental were up 0.6 percent at $109.02 in Frankfurt after the announcement. Also on Thursday, BaFin, Germany's financial regulator, said it found no indication that Schaeffler violated any disclosure rules when it moved to acquire 36 percent of Continental's shares. The company acquired the stake before announcing its intent to take a controlling stake in Continental. BaFin said that did not violate any law. Under German securities law, investors must disclose their stakes when they cross thresholds ranging from 3 percent to 30 percent.
