On page 11 of the May 4, 2009 issue of AutoWeek, there's a brief article about Porsche having a huge $12 billion debt and that VW is considering an audacious reverse takeover bid to gain control of Porsche.

Stay tuned.
Mr. B

 

I read something similar...the tide may be turning...

 

Let's hope Porsche survives
Mr. B

 

I've read a blurb about it a couple of weeks ago. Somehow, Porsche with its 51% controlling interest is attempting to get a VW subsidiary to provide cash for Porsche’s rolling debt maturities. The world wide credit crisis is affecting all those who are unlucky enough to have maturities at this inopportune time.

 

I wouldn't mind some of that Audi magic for the interiors...

 

from Reuters:


FRANKFURT (Reuters) - The Porsche and Piech families are set to make a decision over a possible sale of Porsche AG to Volkswagen (VOWG.DE) on Wednesday in attempt reduce Porsche's holding company's large debt, reported Focus magazine on Saturday.

The five most important representatives from the two families -- who control all the votes in Porsche Automobil Holding SE (PSHG_p.DE) -- already met last Wednesday to discuss the matter but could not reach a final decision, Focus said in an article to be published on Monday. The magazine did not cite its sources.

This Wednesday the families will decide if Porsche will perhaps sell Porsche AG and its eastern European dealer network to Europe's largest automaker, the magazine said.

The head of Porsche's supervisory board head, Uwe Hueck, was vehemently opposed to a possible sale of Porsche's automotive operations, Focus added.

In April speculation had already arisen that VW could buy the sports car manufacturer's production operations. A Porsche spokesman, however, described such a sale as "a highly unrealistic option."

Porsche Automobil, which has already spent about 23 billion euros to gain control of a nearly 51 percent 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.

At Wednesday's meeting VW supervisory board member Ferdinand Piech promoted a plan worked on by VW Chief Executive Martin Winterkorn which proposed a sale of Porsche to VW for around 11 billion euros, which would wipe clean the debts of both the Piech and Porsche families, the magazine said.

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

Focus reports that Wiedeling, however, suggested an alternative plan in which Porsche's debt would be paid off through a capital increase.
Through the plan, the large shareholding families would have the finances at their disposal to preserve Porsche's independence.

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

Uwe Hueck strongly criticized calls for a possible sale of Porsche, Focus said. Porsche's two family owners had earned around 15 billion euro in profits in the last ten years and Hueck could not understand why they were unwilling to invest more money into the automaker and instead agree to its sale, the magazine cites Heuck as saying.

Should the owners decide in favor of a sale, Porsche's workers would distance themselves from the families and use everything in their power to preserve the automaker's independence, the magazine further cites Heuck as saying.

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 that the two families could sell assets other than Porsche AG, if Porsche Automobil needed additional funding.

(Reporting by Tyler Sitte)
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sounds like some kind of 'scheme' to buy volkswagen with it's own money?

 

Correct me if I am wrong, sounds like Porsche Automobil owns all of Porsche AG and 51% of VW. Selling Porsche AG still means they own 51% of Porsche via VW.

In other words which pocket is the money coming from? The families are still going to be calling the shots and can always reverse the move when borrowing money is easier again.

 

Owners of A spends money to buy 51% of B, and after doing so, moves B to buy A out and clears the debt for owners of A? Now all debt is with B and the original owners is debt free while maintain control of both A and B.

Either its a great strategy or the FTC or its equivalent over in EU should check into these circular transactions...

 

Volkswagen, Porsche to integrate operations
By Shawn Langlois, MarketWatch
Last update: 3:40 p.m. EDT May 6, 2009
SAN FRANCISCO (MarketWatch) -- Porsche Automobil Holding SE on Wednesday said it will merge operations with Volkswagen AG and come together as one giant automaker, essentially building 10 independent car brands under one roof.
Stuttgart, Germany-based Porsche said it is looking "to develop a corresponding basis for decision-making" within a month. The plan will also include unspecified "capital measures," Porsche added.
"In the final structure, 10 brands shall stand below an integrative leading company alongside each other, whereby the independence of all brands and explicitly also of Porsche shall be ensured," the iconic sports-car maker said.
Volkswagen, of Wolfsburg, Germany, currently rolls out nine brands while Porsche builds its namesake sports cars and Cayenne SUVs.
Volkswagen followed up the announcement by saying it "welcomes the decision by representatives of the Porsche and Piëch family shareholders."
Volkswagen said talks regarding the future structure will now take place between the two companies, representatives from their workforces and VW's home state of Lower Saxony -- which owns 20% of the carmaker.
Porsche announced back in January that it had built its stake in Volkswagen to more than 50% with an eye toward bringing it up to 75%. Porsche, however, is grappling with mounting debt amid the global auto recession

 

As long as Porsche survives and keeps making these fabulous cars, I'll be happy.
Mr. B

 

+1 Mr B.

 

Long live Porsche!

 

I don't want Audi or VW (same, I know) anywhere near Porsche. Their interiors may look nice but their quality, quite frankly, sucks.