Posted on 05/25/2009 5:21:46 PM PDT by bruinbirdman
German car maker Porsche is struggling to raise €1.75bn (£1.54bn) to cover debts and unwind derivative positions stemming from its botched attempt to take over vastly-bigger Volkswagen.
Porsche's shares fell 3.1pc in Frankfurt on Monday after it emerged that the company had obtained a €700m loan from Volkswagen as long ago as March. A Porsche spokesman said the group is negotiating bridging finance with a variety of banks, including the state lender KfW.
It is understood that Porsche is also in talks with the Bank of Tokyo for a €750m loan, and is seeking help from the regional government of Baden-Wurttemberg.
The crisis is yet another headache for the German authorities as they put together a rescue deal this week for Opel, most likely with Fiat. Separately, the hotel and retail group Arcandor said it faced collapse without a €650m state bail-out. Arcandor's share price fell 20pc. The company owns the Karstadt department stores, Quelle, and Thomas Cook. It employs 50,000 workers.
Porsche acquired a 51pc share of VW earlier this year after a series of derivatives deals that tripled Porsche's debt to €9bn.
The takeover bid went badly wrong, forcing Porsche chief Ferdinand Piech to press instead for a merger of the two car makers on increasingly less favourable terms.
Porsche's travails are largely due to financial acrobatics, not falling sales.
(Excerpt) Read more at telegraph.co.uk ...
They should get 0bama to force them into bankruptcy where he takes control.
have you driven a porsche, lately?
It is a very negative article on Porsche..Try this one.
http://www.economist.com/business/displaystory.cfm?story_id=13649071
After reaching an agreement on May 6th to call off Porsche’s improbable attempt to take over VW, a company 15 times its size, the Porsche and Piëch families, who control 100% of the voting stock in Porsche Automobil Holding, gave themselves four weeks to hammer out the terms and structure of a merger between the two firms. But Mr Piëch, who personally owns 10% of Porsche, has now made it quite clear that it is he and VW that are in the driving seat and not, as seemed likely only a few months ago, his cousin, Wolfgang Porsche, or Mr Wiedeking. The final shape of the merged group has yet to be fixed, but Mr Piëch dropped some pretty broad hints.
Mind you I would love one and they still look cool, but my understanding is a lot of other brands, even Corvette, can outperform — across the board — Porsches by class, even a the super upper end.
Any car folk want to confirm or enhance?
Take over Volkswagen?
A Porsche IS a Volkswagen - with a higher pricetag, some bodywork and a driver who loves retrotech.
(Donning Nomex and getting out the extinguisher.)
Do not even joke about stuff like that....
Proud Porsche owner...
Typical Germans. My male Daschund fell in love with the neighbor's Labrador .....
That is what I have been hearing — Porsche has dropped to 3rd or 4th in all classes it competes in.
The two cars that I mentioned - I own one and a lazy relative of mine owns the other.
(The guy with no visible means of support has the Vette - go figger!)
Porsche had this takeover in the works for years,if the economy had not gone south they would control VW now.
And yes the Germans have a habit of biting more than they can chew.
How does the dog love story end badly i presume?
I have never driven a Porsche but my sister in law has one and I have ridden in hers. It is probably the most uncomfortable car I have ever ridden in. Maybe they are so much fun to drive that the driver doesn’t realize the passenger wants out!
Ping
>>The guy with no visible means of support has the Vette - go figger!
Same way that the “poor people who followed the rules” being foreclosed on always have a beautiful 60” flat screen TV while I, who never has missed a payment, have a 10-year 32” old tube type.
Let me get this straight: They are borrowing money from a company, larger than them, that they took over? How exactly does that work? Well, maybe it doesn’t work.
They aren’t that much fun.
The owners just won’t admit that they made an $80,000 mistake.
The moral of this story: stick with what you know, and quit trying to make a dishonest buck with financial shenanigans!
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.