A joint statement made by the two companies said they expect a final deal to be reached by May 2009. As a result, both of the companies' shares sky rocketed, placing SGL 8.48 percent higher at 19.82 euros ($26.56) in Frankfurt and Brembo up 5.24 percent at 3.06 euros in Milan in early afternoon trading today.
"This is going to form a company with an absolute leadership in the world (in this market)," Abaxbank analyst Antonio Tognoli was quoted as saying by the aforementioned source.
In the sales report posted by Brembo on March the 19th, the company recognized that in "January and February, passenger car sales were as sluggish as the previous months recording a decline of about 22 percent compared to the previous year and it doesn't show any signs of recovery."
As a result, Brembo admitted its order book was "weak" and the company will continue to adopt all the "extraordinary measures needed to align production to demand." Brembo's financial performance is more or less tied to the one of Italian manufacturers Ferrari and Fiat.
On the SGL side, the joint venture would help the company reduce its dependence on products like graphite electrodes, which make for most of the company's revenues.
The two future partners did not provide any other details about their future venture, nor the stage of the talks.
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