October 21, 2014 / 9:17 PM / 6 years ago

Daimler sees $780 million windfall from sale of Tesla stake

FRANKFURT (Reuters) - Daimler AG (DAIGn.DE) said on Tuesday it would book a $780 million windfall from selling its 4 percent stake in rival electric car maker Tesla Motors Inc (TSLA.O).

The logo is seen on a new all-wheel-drive version of the Tesla Model S car in Hawthorne, California October 9, 2014. REUTERS/Lucy Nicholson

The stake sale comes as a surprise, even though the Stuttgart-based maker of Mercedes-Benz cars insisted that a technological cooperation deal between the two carmakers remains unchanged.

Tesla declined to comment.

In a statement, Daimler Chief Financial Officer Bodo Uebber said, “We are extremely satisfied with the development of our investment in Tesla, but it is not necessary for our partnership and cooperation. For this reason, we have decided to divest of our shares.”

The sale of Daimler’s stake in Tesla will result in a cash inflow of around $780 million, boosting earnings before interest and taxes by a similar amount for 2014. Proceeds from the stake sale will be used to strengthen Daimler’s operational business, the automaker said.

A cooperation agreement to supply Mercedes-Benz cars with Tesla battery technology remains unaffected by the sale, Daimler Chief Executive Dieter Zetsche added.

“Our partnership with Tesla is very successful and will be continued,” he said.

Tesla is supplying electric motors and batteries to Daimler for its Smart Fortwo electric vehicle (EV) and the new Mercedes-Benz B-Class Electric Vehicle.

Last December, Daimler hedged its holding in Tesla against a possible decline in the EV maker’s shares over the next three years, a step it justified on the grounds that it would help underline the long-term nature of the partnership.

The abrupt selloff comes amid repeated assurances by senior Daimler executives including Zetsche that Daimler was interested in deepening a cooperation with Tesla

Reporting by Edward Taylor in Frankfurt and Bernie Woodall in Detroit; editing by G Crosse and Matthew Lewis

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