Acceptable premium

20 July 2007 By Una Galani Follow @ugalani

New chief Peter Loescher inherits the planned float of the German giant s automotive parts unit VDO. But a trade sale would make more money. Blackstone s TRW might pay the most, but private equity comes with high political costs. Continental could be a good compromise buyer.

This content is for Subscribers only

Context News

German carparts maker Continental and rival Blackstone's TRW are understood to have submitted bids for Siemens VDO automotive unit, according to sources. The offer from TRW is reported to be valued at E12bn – higher than the current bid from Continental.

Siemens supervisory board is expected to discuss the future of VDO at its next meeting scheduled for July 25. The company has said it will consider all options for VDO but maintains that a stock market listing is the preferred option.

VDO makes electronics for the automotive industry. In 2006, the unit reported annual sales of E10bn and operating profit E669m, equivalent to 9% of the group total. Siemens built up VDO through the E9.5bn acquisition of Atecs from Mannesmann in 2001.

Email a friend

Please complete the form below.

Required fields *