Schaeffler to Divest 10% of Continental

Germany's Schaeffler AG plans to sell 10% of its stake in Continental AG to help reduce its debt. The sale of 20.8 million shares is expected to raise about €1.6 billion.

The ball bearings maker took on about €10 billion in debt when it acquired more than 90% of Conti in 2008. The company had reduced that burden to €7.1 billion by the end of June.

Schaeffler will own 49.9% of the tire and auto parts supplier after the stock sale and remain its largest shareholder. Schaeffler has agreed not to sell additional Conti shares for six months.

The company says it plans a "long-term strategic participation" in Conti.