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Continental wins bidding for Siemens car biz

Posted: 27 Jul 2007 ?? ?Print Version ?Bookmark and Share

Keywords:Siemens VDO? car business? bidding war?

Siemens has sold its entire stake in its automotive segment Siemens VDO to German automotive supplier Continental AG. The move terminates speculations in the industry lasting for months about the parent company's plans.

Given the fierce bidding war between Continental and TRW that was going on behind the scenes, the price of about $15.3 billion seems to be moderate. However, selling a minority stake of VDO at the stock exchange would have generated far less cash for Siemens. Experts believe that the entire company has a value of about $11 billion to $12 billion. "We have reached an outstanding result," said Peter Loescher, Siemens president and CEO, in a press statement. "We have carefully evaluated all options for VDO and chose the best perspectives for employees, customers and our investors."

The move gives Continental additional competence in chassis, safety, powertrain and infotainment technology. With the integration of VDO, Continental is becoming one of the world's largest automotive electronics suppliers. Based on 2006 sales figures, the combined company realizes annual sales of about $34 billion with a workforce close to 140,000.

Continental said it anticipates a synergy potential of at least $233 million a year by 2010. The takeover is subject to antitrust approval. All preparations for the planned IPO have been terminated, said Siemens.

In addition to the sale of its automotive business, Siemens announced it has acquired US-based clinical laboratory company Dade Behring for approximately $7 billion. The company provides clinical laboratory equipment and integrated solutions for chemistry testing, immunodiagnostics and other medical-biological test equipment. In 2006, the 6,400-eployee company achieved sales of about $1.7 billion. The company will round up the product spectrum of Siemens Medical Solutions, in which it will be integrated.

- Christoph Hammerschmidt
EE Times Europe

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