Continental to Bid for Siemens's VDO: Sources
German car parts maker Continental and Blackstone Group with its TRW Automotive Holdings are set to submit bids for VDO, the automotive unit of Siemens, people familiar with the situation said on Wednesday.
Siemens has asked for offers by Friday, the sources said,and while other suitors are not seen in the frame at present, that could change at the last minute.
Siemens has said it will consider all options for VDO, but a stock-market listing is the company's preferred option. Both bids are expected to exceed 10 billion euros ($13.8 billion), the sources added, more than Siemens could expect to raise in an initial public offering and without the added expense, regulatory burdens and risk associated with an IPO.
An industry source familiar with the situation said Continental was now looking to offer 11 billion euros after initially submitting an indicative bid of just over 10 billion.
Dow Jones Newswires reported that TRW would offer just over 12 billion euros for VDO, citing people familiar with the matter.
The company's supervisory board is due to discuss the future of VDO at its next meeting, scheduled for July 25. After that, the board may decide to enter final talks with a single bidder, the paper said.
TRW could not immediately be reached for comment. Siemens, Continental and Blackstone declined to comment.
Siemens shares slipped 0.8% to 106.84 euros by 1424 GMT, while Continental stock also dipped 0.8% to 105.82 euros. TRW shares fell 1.9% to $36.95. VDO makes entertainment systems, safety equipment and sensors for cars. It had 2006 sales of 10 billion euros, about the same size as TRW.
Private equity firm Blackstone is the primary shareholder of TRW, which sells components to automakers including Volkswagen and Ford Motor. TRW is based in Livonia, Michigan.