Skip to comments.Porsche and VW agree merger
Posted on 05/07/2009 1:11:05 AM PDT by bruinbirdman
Volkswagen and Porsche announced plans to merge on Wednesday in a move that would relieve the sports carmaker from its debt burden and bring the 3½-year takeover saga surrounding Europes largest carmaker to an end.
After a meeting of the Porsche family owners and VW and Porsche executives in Salzburg, the family clan agreed to create an integrated car-manufacturing group with 10 marques united under one roof.
The move would in effect set Porsche aside from the nine existing brands of the VW group and bring the sports carmakers hopes of a domination of Europes largest carmaker to an end.
The independence of all brands and explicitly also of Porsche shall be ensured, Porsche said in a statement.
People close to the situation said the plan to create a new holding company would be preceded by a capital increase of up to 4.5bn ($5.9bn) at the stock market-listed Porsche holding.
Porsche said a task force of Porsche and VW managers, works council representatives from both companies and the state of Lower Saxony aimed to devise final details of the company structure in the next four weeks.
Lower Saxony owns just over 20 per cent in VW and has the right to block crucial decisions such as a merger.
Wednesdays agreement closed a family schism that had opened between Wolfgang Porsche, chairman of the eponymous carmaker, and Ferdinand Piëch, chairman at VW, in recent weeks.
The headstrong family managers had clashed over how to bail out Porsche, which is ailing under a 9bn debt load from its stake-building at VW.
Mr Porsche had rebuffed an idea by Mr Piëch for VW to take over Porsche AG, the automotive business that is owned by the indebted holding company.
Porsche has used a contentious options strategy and spent about 23bn to gain control of a nearly 51 per cent stake in VW. It had initially aimed to increase that stake to more than 75 per cent to control the carmaker through a domination agreement.
The new car group could aim to attract outside investors. People close to the situation said several sovereign wealth investors from the Middle East, one from Qatar, had expressed interest in investing in a combined VW/Porsche group.
Is Obama OK with this?
King Obama approves in principle, but would object to the 20 percent control level as insufficient.
Interesting. A few months ago, it was announced that Porsche had made more money in 2008 finagling VW stock than it did selling cars. Now it comes out that Porsche evidently went deep in debt for this and came up empty. That’s what I make out of it. Anybody else?
Does this mean the 914 will be making a comeback?
Damn you. You beat me to it!
It came to mind immediately, having the misfortune to own one in the 80’s.
Fun when they run.
There was a very nice 914 on BringATrailer.com recently. It is the only website besides FR that I visit every day.
I can't really afford a new 4-wheeled toy right now, but it's nice to daydream.
That one looks nice. You can find the occasional rust free one in NM, but the paint is usually blasted pretty bad.
I had my fun with cars, but settled on collecting other stuff. Cars are like food, there’s McD’s and five star restaurants, but it all ends up the same at the end.
“settled on collecting other stuff”
I bet I can guess what. BANG!
Currently I only have my 1955 Chevy 210 wagon. I sold my 1969 Chevy Custom/10 truck a while back.
I enjoy working on old cars. Curiously, I do not find tinkering to be frustrating at all. It’s very relaxing for me, and cheaper than a shrink. :)
“Does it mean the 914 will be back” You sir are very funny!
An Automotive “Anschluss”.
I am indeed!
However, Tijeras_Slim posted that, not me.
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