VW to take over Porsche in reverse bid
24 July 2009
Europe's biggest car mnanufacturer, Volkswagen (VW), said it has decided to buy a stake in Porsche AG, the German sports carmaker, and 'gradually' expand its share over time. The latest move comes after Porsche's chief executive Wendelin Wiedeking and financial director Holger Haerter had resigned 'with immediate effect'.
Wiedeking had failed in his attempt to take over VW. Nearly four years ago, Porsche gobbled up a 20-per cent stake in Volkswagen - it now holds about 51 per cent stake in the company.
Porsche had hoped to build up a 75-per cent stake, but the global economic crisis and the slump in the automotive sector forced the legendry car maker to amass huge debt of about 9 billion euros.
The two companies aim to complete the merger by the middle of 2011, said Christian Wulff, governor of Lower Saxony, the German state that owns a large stake in VW.
"I'm optimistic that we can lay out the details of our agreement in principle during a supervisory board meeting on 13 August," he said.
Chairman Wolfgang Porsche said at the meeting Porsche aims to "secure an independent future for Porsche as part of a globally leading manufacturer,'' adding that the legend of Porsche "will not go under."
Martin Winterkorn, chairman of the VW, said the move "makes two strong companies even stronger".