The international automotive supplier Continental AG, for its Automotive Systems Division, will acquire Automotive Products Italia (SV) S.r.l. (AP) from the Australian Pacifica Group Limited. The acquisition is subject to regulatory approval.

AP, founded in 1984, is a manufacturer of drum and park brakes for passenger and commercial vehicles and has approximately 500 employees. In 2006, the company had sales of approximately € 79 million. The production facility of 17,000 m² is located in Cairo Montenotte, in the province of Savona, Northern Italy and produced approximately 5.8 million drum and park brakes in 2006. Customers include vehicle manufacturers such as Fiat, Ford, Renault/Nissan, Toyota, Land Rover, Mazda and GM. A technical and marketing cooperation agreement between Continental Automotive System and AP was established in 1997 and has been working successfully since then. AP, the second largest producer of drum brakes in Europe, will be integrated into the Business Unit Hydraulic Brake Systems of Continental Automotive Systems.

With its focus on high-volume drum brake production and global customer support, AP Italy will strengthen Continental Automotive Systems' product portfolio as a systems supplier in the area of affordable cars. It thus reinforces the division's strategy to provide high-tech and cost-effective brake systems to the fast growing, emerging markets, notably in Asia. Products include mainly drum brakes, drum in disc brakes and duo servo brakes.

"With the acquisition of AP, Continental Automotive Systems will benefit from the company's perfect market penetration in established markets and strengthen its worldwide position in drum brakes", said Dr. Karl-Thomas Neumann, President Continental Automotive Systems and Member of the Executive Board, Continental AG.

"In addition, it will help us to grow in new, emerging markets, which require drum brakes for local applications. This will be particularly important to us in China and India"."AP Italia complements our product offer in the field of hydraulic brakes in a perfect way", said Heinz Zingel, Executive Vice President, Hydraulic Brake Systems and member of the Management Board of Continental Automotive Systems. "As AP has been a supplier to Continental Automotive Systems for many years, we already know each other extremely well and can build on a long-standing, trustful and successful relationship. The integration in terms of technology, product range and, most importantly, people, will be as smooth as one can imagine."