Schaeffler to Sell €1 Billion in Bonds to Cut Debt Costs

Schaeffler AG plans to raise about €1 billion in a bond sale to pay off some of the remaining debt from its takeover of Continental AG in 2008.

Schaeffler says the refinancing will reduce its heavy interest expenses. The maker of precision bearings borrowed more than €10 billion to buy 90% of Conti. By the end of 2012, Schaeffler had shrunk its debt burden to €6.8 billion.

After the bond offering, the company says it will use bank loans with improved terms and extended maturities to refinance the debt that remains.