Auto parts maker Continental AG said Thursday it had ended a weekslong standoff over a takeover bid from smaller rival Schaeffler KG and reached a deal after Schaeffler raised its offer and agreed to limit itself to a minority stake.
But the deal claimed a prominent victim, Continental chief executive Manfred Wennemer, who asked to be released from his contract.
Wennemer had opposed the deal from the start, and Hannover-based Continental said in a statement that the 60-year-old "has asked the supervisory board to be released from his responsibilities" by the end of August.
The board agreed and said a successor would be appointed.
Wennemer has been CEO of Continental since September 2001 and helped oversee its expansion and shifting of production to low-cost markets.
Shares of Continental were up more than half a percent to euro73.95 (US$108.95) in Frankfurt after news of the deal was announced.
Continental had repeatedly rejected the offer Schaeffler made last month. It now says the deal reached with the privately held company offers "an acceptable overall concept."
Continental said Schaeffler had agreed to increase its offered price per share to euro75 (US$110.50) from euro70.12 (US$103.31). Continental did not give an overall value for the new offer, but the previous one was worth about euro11.3 billion (US$16.6 billion).
Schaeffler also agreed to limit its stake to a maximum 49.99 percent for four years, Continental said in the statement.
It committed itself "to support the ongoing strategy and business policies of Continental AG's management board while maintaining its current market and brand appearance, and to not demand a sale of activities or seek other material structural measures," the company said.
Continental makes products including tires, brakes and interiors for cars and trucks.
Wennemer and union representatives had voiced fears that Schaeffler might sell the company's tire division if successful in its bid.
Continental said that, under the deal, former German Chancellor Gerhard Schroeder would act as a "guarantor for ensuring the interests of all stakeholders of Continental."
Schaeffler makes ball bearings for the industrial, aviation, aerospace and the automotive sectors as well as components for engines, transmissions and drive trains.