FRANKFURT (Reuters) -- Schaeffler Group denied a report that it is seeking complete control over Continental.
Striking a much more conciliatory note a day after demanding Continental's chairman step down immediately, Schaeffler said on Wednesday it wanted to sit together with all parties involved to find a "peaceful" solution to a simmering boardroom row.
Schaeffler has a 49.9 percent voting stake in Continental and has agreed to keep its stake below half until 2012.
A source close to the company said speculation that Schaeffler had asked its banks to examine a full takeover of the much bigger Continental was not true.
Continental's shares were up just 0.8 percent at 1035 GMT after jumping nearly 14 percent in early trade.
The shares rose after the Handelsblatt German business newspaper said Schaeffler might end its investor accord with Continental and seek complete control, violating the agreement crafted last year to end a bitter takeover battle.
Continental was not available for comment but trade union IG BCE, a co-signatory of the deal, said the public row between the two companies had already led to a significant loss of confidence among the more than 100,000 Continental employees.
The IG Metall engineering union said it would not accept a breach of the investor agreement.
On Tuesday, Schaeffler claimed Continental Chairman Hubertus von Gruenberg had hindered solutions to problems confronting the two groups. It urged von Gruenberg to step down immediately.
Schaeffler is a family-owned engineering group based in Herzogenaurach, Bavaria.
It makes bearings, engine components, clutches under the INA, FAG, Luk brands. In 2007, the Schaeffler's revenues totaled 8.9 billion euros.
With targeted annual sales of 25 billion euros for 2008, the Continental is one of the top automotive suppliers worldwide. It is based in Hanover, Germany.