Aumovio, the auto supplier spun off from Continental, made its trading debut on the Frankfurt Stock Exchange on Thursday at 35 euros a share. As part of the separation, Continental investors received one Aumovio share for every two Continental shares they hold.
Continental’s stock dropped 22% on the day to €56.98 as of 08:26 GMT, compared with Wednesday’s close of €72.98.
The listing represents the first new entrant this year to Germany’s Prime Standard segment. Because it was structured as a spin-off, Aumovio itself did not raise capital from the market.
In line with DAX rules, the new company joined the index for a single day alongside its former parent.
Aumovio, which produces braking systems, vehicle software, electronics and displays, had been Continental’s largest business unit. Ahead of the spin-off, it moved to bolster profitability by cutting expenses and lifting prices, which improved its second-quarter results.
The spin-off comes as Continental continues to reshape its portfolio, planning to divest its industrial arm ContiTech next year to focus on its tires business.
The decision reflects a broader transformation underway in Europe’s auto industry, where suppliers face rising costs, increased Chinese competition and new trade frictions.
Other major suppliers such as ZF Friedrichshafen and Bosch (NSE:BOSH) are shutting plants, while automakers including Audi and Porsche (ETR:P911_p) are redesigning model lineups and tightening costs.
As manufacturers bring more software capabilities in-house, traditional suppliers have seen their roles diminish, leaving space for specialized software providers to gain ground.
Analyst valuations for the spin-off varied, with Bloomberg Intelligence in June estimating the business at €6.5 billion based on a sum-of-the-parts analysis, while Bernstein this month put its worth closer to €4.2 billion.
“We expect selling when Aumovio is separated, but see scope for margins to improve over time,” Jefferies analysts said in a note published earlier in the week.
Source :
https://www.investing.com/news/stock-market-news/continental-sinks-21-as-aumovio-begins-trading-after-spinoff-4243989
