Aumovio, the New German Auto Parts Giant Worth US$4 Billion

The new German auto parts and components supplier Aumovio, which emerged from a spin-off of tire manufacturer Continental, began trading on the Frankfurt Stock Exchange with a market value of approximately €3.5 billion (US$4.14 billion).

The spin-off is part of the Hanover-based parent company's strategy to increase the profitability of this division. Continental shareholders received one additional Aumovio share for every two shares they own.

The new company has approximately 100 million shares outstanding at a price of €35 at the time of its launch. At midday, the stock was trading at €34.64, while Continental shares fell 19.5%.

However, the combined effect left its investors with a net gain of more than 4% after receiving Aumovio shares.

The separation of Continental's auto parts division seeks to streamline decision-making in a turbulent market marked by China's growing dominance and the implementation of tariffs, where cost reduction remains a priority.

Aumovio began trading on the main DAX index last Thursday alongside Continental, which will not receive any new capital from this transaction.

With the spin-off of Aumovio and the sale of its rubber and plastics division, ContiTech, Continental intends to focus on its tire business, which represents the company's largest source of revenue.

Aumovio consists of the business units brakes and safety systems, vehicle software, displays, and electronics. It has more than 86,000 employees in over 100 plants in 25 countries.

The new entity is expected to increase its sales in the long term to over €24 billion, compared to €19.6 billion last year.