Carlyle eyes German rubber deal

The US firm is negotiating to buy Continental's rubber products division for up to E1.2bn.

The Carlyle Group has entered exclusive talks with Continental, the German maker of tyres and car parts, to buy the company's rubber products arm.

Conti-Tech could fetch anything up to E1.2bn if sold to the private equity group. According to the Financial Times, Carlyle has been granted exclusivity after outpacing a number of rival bidders including CVC Capital Partners, Industri Capital and Trelleborg, the Swedish industrial comglomerate.

Doing business with Continental would give Carlyle another high-profile acquisition in Germany's automotive sector. The firm already owns Honsel, the manufacturerer of light-metal high-pressure die castings for the automobile industry, and Beru AG.

Selling Conti-Tech is part of a strategic move away from tyres for Continental. Stephan Kessler, the group's CEO, is aiming for the disposal to be wrapped early in 2002.