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Spin-off part of Continental strategy to up profitability

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Aumovio debuts in Frankfurt at 35 euros per share

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Company faces tough market conditions

(Adds details, background from paragraph 8)

By Emma-Victoria Farr

FRANKFURT, Sept 18 (Reuters) - Auto parts and components

supplier Aumovio, spun off from German tyre maker

Continental, listed on the Frankfurt Stock Exchange on

Thursday with a price of 35 euros ($41.43) per share.

Following the listing, which is part of the Hanover-based

parent company's strategy to increase its profitability,

Continental shareholders will receive an additional Aumovio

share for every two shares they hold.

Aumovio was listed in the main DAX index for one day on

Thursday alongside Continental, and, as a spin-off, will not

receive fresh capital from the new listing.

Its debut marks the first listing this year on Frankfurt's

Prime Standard, a segment of the exchange reserved for companies

complying with higher transparency standards.

With the Aumovio spin-off and the planned sale of its rubber

and plastics division, ContiTech, Continental is aiming to focus

on its tyre business, which boasts a profit margin of around 13%

and represents the company's largest earnings pool.

INCREASED SALES TARGETS, BUT A BLEAK LANDSCAPE

Aumovio, which manufactures brakes and safety systems,

vehicle software, displays and electronics, has over 86,000

employees at more than 100 locations in 25 countries worldwide.

Continental has said the spun off entity is targeting a

long-term increase in sales to over 24 billion euros from 19.6

billion euros last year, with an adjusted EBIT margin in the

range of 6% to 8%.

It will have to overcome a bleak landscape, however, as auto

suppliers and car manufacturers struggle with weak European

demand, tough competition in China, and high U.S. auto import

tariffs.

Trade tensions and geopolitics curtailed European listings

this year. However, following an uptick in sentiment, some,

including Swiss Marketplace Group in Zurich and prosthetics

manufacturer Ottobock in Frankfurt, are now taking the plunge.

($1 = 0.8449 euros)