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    Is Volkswagen taking over Porsche?

     Volkswagen is considering an audacious reverse-takeover bid for its majority shareholder, Porsche, in a twist in the drawn-out struggle for control between the two German carmakers.

    The Volkswagen Group's supervisory board is said to be weighing the possibility of purchasing Porsche AG, in a move that would relieve its holding company, Porsche SE, of massive debt that industry analysts suggest the company may not be able to fund should the world's financial crisis drag on well into 2010--a scenario put forward this week by the International Monetary Fund.

    The secret plan emerged as shareholders were set to convene at Volkswagen's annual meeting on Thursday, and it comes after Porsche revealed that it is carrying some 9 billion euros ($11.73 billion) in debt, most of it owing to interest on loans taken out to purchase its 50.8 percent stake in VW.

    Porsche on Thursday said that the 280 million euros ($365 million) it would receive in dividends from Volkswagen and its own operating profits would be sufficient to service interest payments for 2009. However, questions still hang over Porsche's ability to meet ongoing budgetary concerns, most notably its traditionally large spending on research and development.

    Porsche has raked in massive profits in recent years on controversial option trades for Volkswagen. It recently reported a windfall of 6.8 billion euros ($8.86 billion)--or more than double its own revenue--from its takeover of Volkswagen. However, the gains are mainly related to an increase in the Volkswagen share price, which the banking sector describes as paper gains that are not easily converted to cash.

    The revealing of the Volkswagen plan to consider a bid for Porsche has cast a shadow over the long-term future of Wendelin Weideking. The straight-taking Porsche chairman originally was hailed in financial circles for his daring takeover of Volkswagen, a company more than 10 times Porsche's size. But with the world's financial crisis hitting Porsche's earning potential and its ability to service loans, there have been suggestions that he could be ousted by the Porsche and Piech families, which together hold a majority stake in Porsche.

    For some time now, German automotive-industry analysts have suggested that General Motors Europe boss Carl-Peter Foster could take the helm at Porsche should its bid to wrest control of Volkswagen fail.


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    Re: Is Volkswagen taking over Porsche?

     WW is not Porsche's Chairman. This is one among other inaccuracies,


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    ________________________ 

    A. Dias

    Corvette C6 coupe (sold)

    996 C4 (sold)


    Re: Is Volkswagen taking over Porsche?

    It's speculation IMO 


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    Rennteam Moderator - 997.1 C2S Coupe GT Silver/Cocoa, -20mm/LSD, PSE, SportDesign rims, Zuffenhausen collection


    Re: Is Volkswagen taking over Porsche?

    Personally, I have always wished for Porsche and VW to be together initially for historical and emotional reasons and then for business/strategic/technological.

    I don't care who owns whom as to me it is irrelevant. If you see how all the brands have flourished under VW from Skoda to Lamborghini and Bugatti, Iit is obvious that  Porsche would be in very safe hands.


    --
    It's not where you're going, it's how you get there that counts

    Re: Is Volkswagen taking over Porsche?

    winterkorn_wiedeking_hug_wide_main.jpg


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    Happy Driving

    Re: Is Volkswagen taking over Porsche?

    If VW would have full unfettered control of Porsche it would not be good. As Ferry Porsche said "they should remain small and independent". 


    --

    ________________________ 

    A. Dias

    Corvette C6 coupe (sold)

    996 C4 (sold)


    Re: Is Volkswagen taking over Porsche?

    ADias:

    If VW would have full unfettered control of Porsche it would not be good. As Ferry Porsche said "they should remain small and independent". 

    I'd prefer that.

    But even if it was the other way round, it wouldn't be the end of the world.


    --
    It's not where you're going, it's how you get there that counts

    Re: Is Volkswagen taking over Porsche?

    Relax guys!

    0,1020,1498650,00.jpg


    Re: Is Volkswagen taking over Porsche?

    Exactly - I see it purely as a way of re-distributing capital within the VW-PAG group in order to assist with external borrowings 


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    Rennteam Moderator - 997.1 C2S Coupe GT Silver/Cocoa, -20mm/LSD, PSE, SportDesign rims, Zuffenhausen collection


    Re: Is Volkswagen taking over Porsche?

    It's actually a way of getting cash to Porsche SE.

    Porsche received a loan from a consortium of Banks (15) for Euro-10B. This loan will permit Porsche to extend the volume to Euro 12.5 billion in the forthcoming weeks.This "new" loan was used to pay off the "old" loan that was used to buy the +50% of VAG shares. Agreed at market conditions are two tranches of twelve month with the right of extending a tranche of Euro 6.7 billion for an additional year. Porsche intends to pay down the smaller tranche fast and aims for credit ratings the results of which should be available in may 2009.
    This is what is behind the rumor.


    Re: Is Volkswagen taking over Porsche?

    By Tyler Sitte

     

    FRANKFURT (Reuters) - Wolfgang Porsche, head of the supervisory board of Porsche and patriarch of one of its two controlling families, said the carmaker will not be sold to Volkswagen (VOWG.DE).

     

    Media reports have said the Porsche and Piech families are set to make a decision on Wednesday over a possible sale of Porsche AG to Europe's largest automaker. They are trying to find ways to reduce the huge debt of Porsche's holding company.

     

    "We are currently on the right path. Porsche AG will not be sold to Volkswagen," Porsche told the Frankfurt Allgemeine Sonntagszeitung (FAS) in an article to be published on Sunday.

     

    The statement from the head of the Porsche clan appears to put him on a crash course with his cousin Ferdinand Piech, who advocates a sale of Porsche to VW.

     

    According to articles in Spiegel and Wirtschaftswoche, Piech backs the VW option that would effectively wipe clean the debts of both the Piech and Porsche families, who control all the votes in Porsche Automobil Holding SE (PSHG_p.DE).

     

    In addition, Piech suggested Porsche should replace its chief executive, Wendelin Wiedeking, and Chief Financial Officer Holger Haerter with VW CEO Martin Winterkorn and VW CFO Hans Dieter Poetsch.

     

    Wirtschaftswoche said the sale could be worth around 11 billion euros.

     

    TOUGH DECISION

     

    Porsche Automobil, which has spent about 23 billion euros to gain control of a nearly 51 percent stake in Volkswagen, has said it plans to raise its VW voting stake to 75 percent as early as this year should economic conditions allow.

     

    At the end of January, Porsche had racked up debt of 16.2 billion euros, mostly stemming from its purchase of VW stock.

     

    According to the FAS, Wolfgang Porsche has voiced support for a plan proposed by Wiedeking in which Porsche and VW would be merged under a new holding company that Wiedeking would then run.

     

    Sketching a similar scenario, Wirtschaftswoche said Porsche's debt could be paid off through a capital increase and the large shareholding families would have the finances at their disposal to preserve Porsche's independence. The report did not cite sources.

     

    Wiedeking's plan would most likely see Porsche give up its ambitions to raise its stake in VW to 75 percent in order to secure profit-transfer and controlling agreements.

     

    The rising cost of debt has caused Porsche to consider alternative ways of raising money over the long term, including selling assets, people familiar with the matter have told Reuters.

     

    The sources said the two families could sell assets other than Porsche AG if Porsche Automobil needed additional funding.

     

    (Reporting by Tyler Sitte; editing by Robert Woodward)


    Re: Is Volkswagen taking over Porsche?

    Thx for the update!


    Re: Is Volkswagen taking over Porsche?

     

    Right now there seems to be a power struggle at Porsche. Ferdinand Piech wants to sell Porsche to VW for around 11 billion EUR and to gain control over the whole thing, at the same time getting rid of Dr. Wiedeking. Wolfgang Porsche and other Porsche family members (Mr. Piech is also a Porsche family member but he has/had always a different opinion about how things have to be running, maybe because he always had the technical part in mind, not the financial one) actually seem to want to support Mr. Wiedeking.

    So yes, Porsche could be sold to Volkswagen, another possibility could be a merger with Volkswagen. Whatever happens, Mr. Wiedeking is under a lot of pressure and I'm not sure he really deserves that. Without Mr. Wiedeking, Porsche wouldn't be where they are now and I think that not only Wolfang Porsche knows this, also Mr. Piech.

     


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    RC (Germany) - Rennteam Editor 997 Turbo, Cayenne Turbo S, BMW M3 Cab DKG, Mini Cooper S JCW


    Re: Is Volkswagen taking over Porsche?

    reginos:

    Personally, I have always wished for Porsche and VW to be together initially for historical and emotional reasons and then for business/strategic/technological.

    I don't care who owns whom as to me it is irrelevant. If you see how all the brands have flourished under VW from Skoda to Lamborghini and Bugatti, Iit is obvious that  Porsche would be in very safe hands.

     

    Porsche would loose a lot of its identity if this happens, I'm not sure this would be a good thing. IF it happens, I would like to see Porsche together with Lamborghini and Bugatti in some sort of a holding but NOT under the brand Volkswagen.

    There are markets, like the US market for example, where the brand Volkswagen isn't perceived too well, so it would be a huge mistake.


    --

    RC (Germany) - Rennteam Editor 997 Turbo, Cayenne Turbo S, BMW M3 Cab DKG, Mini Cooper S JCW


    Re: Is Volkswagen taking over Porsche?

    RC:
    reginos:

    Personally, I have always wished for Porsche and VW to be together initially for historical and emotional reasons and then for business/strategic/technological.

    I don't care who owns whom as to me it is irrelevant. If you see how all the brands have flourished under VW from Skoda to Lamborghini and Bugatti, Iit is obvious that  Porsche would be in very safe hands.

     

    Porsche would loose a lot of its identity if this happens, I'm not sure this would be a good thing. IF it happens, I would like to see Porsche together with Lamborghini and Bugatti in some sort of a holding but NOT under the brand Volkswagen.

    There are markets, like the US market for example, where the brand Volkswagen isn't perceived too well, so it would be a huge mistake.

    At first I was thinking negatively about such an eventuality, but Lamborghini is a good example of a brand that benefited greatly from VW ownership without any downside at all.


    --
    It's not where you're going, it's how you get there that counts

    Re: Is Volkswagen taking over Porsche?

    I'm not sure if the reputation of Lamborghini could have been worse when VW acquired it. 

    Ask Italians what they thought about Lamborghini a couple of years ago, even now it isn't quite THE brand when it comes to sportscars but the reputation has increased substantially because Lamborghini was associated to Audi and not VW. Most people don't seem to realize that Audi is actually part of VW but the perception is very important, especially regarding certain markets. So IF VW wants to buy Porsche and succeeds, it is very important to create some sort of holding with Lamborghini together or at least some sort of alliance. If the brand name Volkswagen appears together with the brand name Porsche, this could create some serious "perception" problems. 


    --

    RC (Germany) - Rennteam Editor 997 Turbo, Cayenne Turbo S, BMW M3 Cab DKG, Mini Cooper S JCW


    Re: Is Volkswagen taking over Porsche?

    Some info about the various options available

    http://www.reuters.com/article/privateEquity/idUSB10645220090504


    --
    It's not where you're going, it's how you get there that counts


    Re: Is Volkswagen taking over Porsche?

    RC:
    Porsche would loose a lot of its identity if this happens, I'm not sure this would be a good thing. 

     

    That's what I think. It matters a great deal who owns and manages a company. A change in PAG's management will make it a different company going forward. Stay tuned.


    --

    ________________________ 

    A. Dias

    Corvette C6 coupe (sold)

    996 C4 (sold)


     
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