Reports out of Germany are that Continental AG has made an important debt repayment on time.
Continental, which has been the subject of an acquisition by the Schaeffler Group, said it made the 800 million-euro debt repayment August 20. The company still faces a 3.5 billion euro payment next August.
Schaeffler reported on August 18 that a bank agreement gave it the resources for a 12 billion euro debt refinancing, which moves the company closer to its planned merger with Continental.
Shaeffler is primarily known as a ball bearing manufacturer, with the INA and FAG brands, but also owns the Luk clutch business.
Schaeffler paid 75 euros a share for Continental and now controls more that 90% of the stock, which has plunged 62%. The two manufacturers are saddled with more than 20 billion euros in debt. Schaeffler directly owns 49.9% of Continental and placed a 40.3% holding with banks to comply with the investment agreement.